-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Uv2frPucuyKV8EcbEdT2qFuZTuln9Bo88fqnTPIwCouMEr96eL8f9eZRRUnQSX0U AOVVnzIXiwtRR3SIoU8W0Q== 0000872032-07-000020.txt : 20070907 0000872032-07-000020.hdr.sgml : 20070907 20070907101949 ACCESSION NUMBER: 0000872032-07-000020 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20070630 FILED AS OF DATE: 20070907 DATE AS OF CHANGE: 20070907 EFFECTIVENESS DATE: 20070907 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TAX-FREE FUND FOR UTAH CENTRAL INDEX KEY: 0000872032 IRS NUMBER: 133673542 STATE OF INCORPORATION: MA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-06239 FILM NUMBER: 071104526 BUSINESS ADDRESS: STREET 1: 380 MADISON AVE STREET 2: SUITE 2300 CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2126976666 MAIL ADDRESS: STREET 1: 380 MADISON AVE., STE 2300 CITY: NEW YORK STATE: NY ZIP: 10017 FORMER COMPANY: FORMER CONFORMED NAME: TAX FREE FUND FOR UTAH DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: PLEIADES TAX FREE FUND DATE OF NAME CHANGE: 19920514 0000872032 S000009140 TAX-FREE FUND FOR UTAH C000024856 TAX-FREE FUND FOR UTAH CLASS A UTAHX C000024857 TAX-FREE FUND FOR UTAH CLASS C UTACX C000024858 TAX-FREE FUND FOR UTAH CLASS I UTAIX C000024859 TAX-FREE FUND FOR UTAH CLASS Y UTAYX N-CSR 1 tffuncsr.txt TAX-FREE FUND FOR UTAH 6/30/07 NCSR UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-6239 Tax-Free Fund for Utah (Exact name of Registrant as specified in charter) 380 Madison Avenue New York, New York 10017 (Address of principal executive offices) (Zip code) Joseph P. DiMaggio 380 Madison Avenue New York, New York 10017 (Name and address of agent for service) Registrant's telephone number, including area code: (212) 697-6666 Date of fiscal year end: 6/30 Date of reporting period: 06/30/07 FORM N-CSR ITEM 1. REPORTS TO STOCKHOLDERS. ANNUAL REPORT JUNE 30, 2007 [LOGO OF TAX-FREE FUND FOR UTAH: A RECTANGLE CONTAINING DESERT BOULDERS WITH THE SUN RISING BEHIND THEM](SM) TAX-FREE FUND FOR UTAH A TAX-FREE INCOME INVESTMENT [LOGO OF THE AQUILA GROUP OF FUNDS: ONE OF THE AN EAGLE'S HEAD] AQUILA GROUP OF FUNDS(SM) [LOGO OF TAX-FREE FUND FOR UTAH: A RECTANGLE CONTAINING DESERT BOULDERS WITH THE SUN RISING BEHIND THEM](SM) SERVING UTAH INVESTORS FOR 15 YEARS TAX-FREE FUND FOR UTAH "PROFESSIONAL MANAGEMENT" August, 2007 Dear Fellow Shareholder: Rising interest rates, reaching for yield and tightening yield curves - these are all topics that have been in the news as of late. While there is a plethora of information available on these topics and others if you are interested, the good news is that when it comes to Tax-Free Fund For Utah you don't need to be versed in "financialese" any more than you wish. Why? Because one of the conveniences afforded you through an investment in Tax-Free Fund For Utah is local active professional portfolio management. The Fund's portfolio managers continuously monitor economic, monetary and financial trends and adjust the portfolio accordingly as and when they deem appropriate. Your Fund's portfolio managers provide ongoing surveillance of the marketplace and strive to maneuver cautiously through its ups and downs - much like a ship's captain whose job it is to ride out sudden storms. Not unlike the prudent ship's captain who ensures that the cargo is properly balanced and positioned, the Fund's portfolio managers are constantly monitoring the investment portfolio and the economic weather conditions striving to provide as stable a net asset value and as high a level of tax-free income as possible. As with a ship in choppy seas, your investment requires constant vigilance and nimble reflexes in all phases of its management. This does not, however, mean selling and buying securities continuously based upon market NOT A PART OF THE ANNUAL REPORT blips. What it does mean is being a keen observer of the scene, monitoring securities very carefully and taking action as appropriate whenever significant changes occur or are anticipated. Your portfolio managers seek opportunities that make sense within the prevailing marketplace and which provide double tax-free income while maintaining the overall conservative nature of the portfolio. In short, your professional managers do the work for you. So, the next time you come across a boring, complex analysis of the bond market, feel free to flip right past it. Your Fund's portfolio management team's job (and their passion) is to keep on top of and make sense out of all the news. Thus, like a seasoned traveler, you can enjoy your trip knowing that there are experienced eyes watching the waters and steady hands on the helm. Sincerely, /s/ Lacy B. Herrmann /s/ Diana P. Herrmann Lacy B. Herrmann Diana P. Herrmann Founder and Chairman Emeritus President For certain investors, some dividends of your Fund may be subject to Federal and State taxes, including the Alternative Minimum Tax. NOT A PART OF THE ANNUAL REPORT [LOGO OF TAX-FREE FUND FOR UTAH: A RECTANGLE CONTAINING DESERT BOULDERS WITH THE SUN RISING BEHIND THEM](SM) SERVING UTAH INVESTORS FOR 15 YEARS TAX-FREE FUND FOR UTAH ANNUAL REPORT MANAGEMENT DISCUSSION The Federal Reserve (the "Fed") has maintained the target for the overnight federal funds rate at 5.25% for the past nine consecutive Open Market Committee meetings, unchanged since June 2006. This "sideways" move in short-term rates has recently led to a positively sloped U. S. Treasury yield curve, with 30-year Treasuries yielding over 5.25%. The Fed's strategy of containing inflation by not allowing the national economy to overheat has recently been a bit of a challenge. While both the Consumer Price Index ("CPI") and the Producer Price Index ("PPI") have been reasonably well contained, except for troublesome energy costs, housing starts and dramatically slowed sales of existing homes across the country. Comments from Fed chairman Paul Bernanke hint at the possibility that further rate hikes will depend more on inflation than economic expansion, somewhat of a reversal from a year ago. With segments of the economy "cooling down", especially the housing market, perhaps rates are approaching their peak. The jury is still out, but we remain hopeful! We have been witness to a number of national and international events that affect both our spirit and the economy: the ongoing conflicts in Iraq and Afghanistan, renewed concern of terrorist attacks here and abroad, provocative statements and actions by Iran regarding their nuclear ambitions, severe drought conditions across much of the nation, and continuing record prices at the gas pump. As we head into the second half of 2007, we think it is likely that the Fed will maintain the current target for short-term rates. The unemployment rate of 4.5% is the lowest rate reported since July 2001. Other measures of economic progress - retail sales, housing starts, and industrial production are all well off their highs of the past 12 months - clear signs of a moderating economy. Historically, as we see slowing on the economic front, inflation will also show signs of easing. While this cycle is a bit different because of record high energy prices, we believe it is likely that the economy will grow at an estimated 2.50% - 3.50% annual rate. Tax-Free Fund For Utah's Class A shares experienced an increase in share value (Net Asset Value) of $0.04 - approximately 0.41% - for the 12-month period ending June 30, 2007. The Class A share value was $9.91 on June 30, 2007 - up from $9.87 on June 30, 2006. The yield of a typical AA-rated general obligation bond with a 15 year maturity fell to 4.47% from 4.52% over this same period. The distribution yield on the Fund's Class A shares was 4.06% on June 30, 2007. Assuming a 28% federal income tax rate, this equates to a taxable equivalent yield of 5.64%. Using the maximum federal income tax rate of 35%, the taxable equivalent yield was 6.25%. Equity returns for the 12 months ended June 30, 2007 continued their positive performance from last year: the Dow Jones Industrial Average was up 23.02%; the S & P 500 Index was up 20.57%; and the NASDAQ Composite Index was up 20.71%. Tax-Free Fund For Utah had a total rate of return of 4.60% for the past 12 months. MANAGEMENT DISCUSSION (CONTINUED) Historically, as the economy has grown, commodity prices and interest rates rise. We continue to monitor any changes in the market and strive to position Tax-Free Fund For Utah's portfolio accordingly. To address the concerns raised by any increase in the overall level of interest rates, we take great care in the selection of the individual bonds purchased for the Fund. We will seek to continue to add high quality, intermediate maturity Utah municipal bonds that best meet our demanding standards. The investment objective of Tax-Free Fund For Utah is to provide as high a level of double tax-exempt current income as is consistent with the preservation of capital. We believe this objective continues to be successfully addressed by our adherence to a discipline of solid fundamental, conservative portfolio management ideals. The Fund continues to maintain an average quality rating of "AA", with over 68% of the portfolio rated "AAA". We believe that the Fund's laddered maturity structure helps us manage price volatility. The portfolio has an average life of approximately 13.7 years and a modified duration of 7.02 years. We seek to maintain a well-diversified portfolio, which currently consists of 365 different issues, all of which are 100% exempt from Federal and Utah state income taxes. With the national and local economies continuing to show improvement, we will remain vigilant and do whatever is necessary as we strive to continue to meet the Fund's investment objective. We intend to "stay the course" and manage the portfolio by taking advantage of opportunities in the Utah marketplace that are consistent with the high standards of the Fund. PERFORMANCE REPORT The following graph illustrates the value of $10,000 invested in the Class A shares of Tax-Free Fund For Utah for the 10-year period ended June 30, 2007 as compared with the Lehman Brothers Quality Intermediate Municipal Bond Index and the Consumer Price Index (a cost of living index). The performance of each of the other classes is not shown in the graph but is included in the table below. It should be noted that the Lehman Index does not include any operating expenses nor sales charges and being nationally oriented, does not reflect state specific bond market performance. [Graphic of a line chart with the following information:]
Lehman Brothers Cost of Fund Class A Shares Fund Class A Shares Quality Intermediate Living Index no sales charge with sales charge Municipal Bond Index 6/97 10,000 10,000 9,600 10,000 6/98 10,169 10,784 10,354 10,695 6/99 10,381 10,993 10,554 11,019 6/00 10,712 11,231 10,783 11,463 6/01 11,099 12,213 11,725 12,476 6/02 11,230 12,984 12,466 13,343 6/03 11,462 14,139 13,574 14,387 6/04 11,811 14,004 13,445 14,436 6/05 12,142 15,012 14,412 15,214 6/06 12,648 15,021 14,421 15,266 6/07 12,986 15,662 15,036 15,905
AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED JUNE 30, 2007 ------------------------------------------- SINCE 1 YEAR 5 YEARS 10 YEARS INCEPTION ------ ------- -------- --------- Class A (commenced operations on 7/24/92) With Sales Charge .................... 0.43% 3.69% 4.42% 5.11% Without Sales Charge ................. 4.60 4.54 4.85 5.40 Class C (commenced operations on 5/21/96) With CDSC ............................ 2.74 3.69 3.91 4.21 Without CDSC ......................... 3.77 3.69 3.91 4.21 Class Y (commenced operations on 5/21/96) No Sales Charge ...................... 4.80 4.71 5.03 5.34 Lehman Index ................................. 4.19 3.57 4.75 5.21* (Class A) 4.80** (Class C&Y)
Total return figures shown for the Fund reflect any change in price and assume all distributions within the period were invested in additional shares. Returns for Class A shares are calculated with and without the effect of the initial 4% maximum sales charge. Returns for Class C shares are calculated with and without the effect of the 1% contingent deferred sales charge (CDSC), imposed on redemptions made within the first 12 months after purchase. Class Y shares are sold without any sales charge. The rates of return will vary and the principal value of an investment will fluctuate with market conditions. Shares, if redeemed, may be worth more or less than their original cost. A portion of each class's income may be subject to federal and state income taxes and/or the federal alternative minimum tax. Past performance is not predictive of future investment results. * From commencement of operations on 7/24/92. ** From commencement of operations on 5/21/96. - -------------------------------------------------------------------------------- REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Trustees and Shareholders of Tax-Free Fund For Utah: We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Tax-Free Fund For Utah as of June 30, 2007 and the related statement of operations for the year then ended, and the statements of changes in net assets and the financial highlights for each of the two years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The financial highlights for each of the years in the three year period ended June 30, 2005 have been audited by other auditors, whose report dated August 12, 2005 expressed an unqualified opinion on such financial highlights. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of the Fund's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of June 30, 2007, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Tax-Free Fund For Utah as of June 30, 2007, the results of its operations for the year then ended, and the changes in its net assets and the financial highlights for each of the two years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. TAIT, WELLER & BAKER LLP Philadelphia, Pennsylvania August 17, 2007 - -------------------------------------------------------------------------------- TAX-FREE FUND FOR UTAH SCHEDULE OF INVESTMENTS JUNE 30, 2007
RATING PRINCIPAL MOODY'S/ AMOUNT GENERAL OBLIGATION BONDS (23.7%) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- CITY, COUNTY AND STATE (10.7%) Anderson, Indiana San District $ 505,000 4.600%, 07/15/23 AMBAC Insured ......................... Aaa/AAA $ 508,611 Brian Head, Utah 405,000 6.500%, 03/15/24 ....................................... NR/NR* 431,017 Cedar City, Utah Special Improvement District Assessment 235,000 5.050%, 09/01/10 ....................................... NR/NR* 239,164 215,000 5.200%, 09/01/11 ....................................... NR/NR* 220,715 Cedar Park, Texas 835,000 4.500%, 02/15/22 MBIA Insured .......................... Aaa/AAA 827,902 Clearfield City, Utah 2,095,000 5.125%, 02/01/18 MBIA Insured (pre-refunded) ........... Aaa/AAA 2,136,272 Coral Canyon, Utah Special Service District 140,000 4.850%, 07/15/17 ....................................... NR/NR* 142,457 580,000 5.700%, 07/15/18 ....................................... NR/NR* 593,189 Dawson County, Texas Hospital District 555,000 4.375%, 02/15/24 AMBAC Insured ......................... NR/AAA 534,959 Denton County, Texas 700,000 4.500%, 07/15/24 MBIA Insured .......................... Aaa/AAA 684,509 400,000 4.500%, 07/15/25 MBIA Insured .......................... Aaa/AAA 387,504 Denton County, Texas Public Improvement 1,500,000 4.250%, 07/15/27 MBIA Insured .......................... Aaa/AAA 1,372,665 Harris County, Texas Utility District #268 905,000 4.375%, 09/01/27 Radian Insured ........................ Aa3/AA 830,138 Hurricane, Utah 185,000 5.400%, 11/01/09 Radian Insured ........................ NR/AA 190,470 Laredo, Texas 300,000 4.250%, 08/15/21 AMBAC Insured ......................... Aaa/AAA 290,691 500,000 4.500%, 02/15/24 AMBAC Insured ......................... Aaa/AAA 489,100 McKinney, Texas 1,700,000 4.500%, 08/15/23 XLCA Insured .......................... Aaa/AAA 1,667,462 1,375,000 5.000%, 08/15/24 XLCA Insured .......................... Aaa/AAA 1,424,555 695,000 4.375%, 08/15/25 MBIA Insured .......................... Aaa/AAA 662,731
RATING PRINCIPAL MOODY'S/ AMOUNT GENERAL OBLIGATION BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- CITY, COUNTY AND STATE (CONTINUED) Mesquite, Texas $ 510,000 4.625%, 02/15/22 FSA Insured ........................... Aaa/AAA $ 513,065 Nevada State 965,000 4.500%, 08/01/21 FSA Insured ........................... Aaa/AAA 965,483 San Antonio, Texas 125,000 4.750%, 02/01/24 FSA Insured ........................... Aaa/AAA 126,275 San Patricio County, Texas 450,000 4.600%, 04/01/25 AMBAC Insured ......................... Aaa/NR 446,737 Spokane County, Washington 420,000 4.500%, 12/01/23 MBIA Insured .......................... Aaa/AAA 417,577 Waco, Texas 2,560,000 4.500%, 02/01/24 MBIA Insured .......................... Aaa/AAA 2,504,320 Washington County, Utah 1,250,000 5.000%, 10/01/22 MBIA Insured .......................... Aaa/NR 1,289,975 Washington State 3,315,000 4.500%, 01/01/22 MBIA Insured ++ ....................... Aaa/AAA 3,294,049 705,000 4.500%, 07/01/23 FSA Insured ........................... Aaa/AAA 697,865 Williamson County, Texas 460,000 4.500%, 02/15/26 FSA Insured ........................... Aaa/AAA 441,480 ---------------- Total City, County and State ........................... 24,330,937 ---------------- SCHOOL DISTRICT (13.0%) Borger, Texas Independent School District 400,000 4.500%, 02/15/24 ....................................... NR/AAA 391,280 500,000 4.500%, 02/15/25 ....................................... NR/AAA 484,595 Canutillo, Texas Independent School District 500,000 4.500%, 08/15/25 ....................................... NR/AAA 484,315 Clint, Texas 265,000 4.250%, 02/15/28 ....................................... NR/AAA 243,397 Dallas, Texas Independent School District 2,500,000 5.000%, 08/15/29 ....................................... Aaa/AAA 2,570,625 Davis County, Utah School District 675,000 5.150%, 06/01/17 (pre-refunded) ........................ Aaa/NR 709,546 Dripping Springs, Texas 725,000 4.375%, 08/15/22 ....................................... Aaa/AAA 712,769
RATING PRINCIPAL MOODY'S/ AMOUNT GENERAL OBLIGATION BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- SCHOOL DISTRICT (CONTINUED) Eagle Mountain & Saginaw, Texas Independent School District $ 300,000 4.750%, 08/15/21 ....................................... Aaa/AAA $ 305,037 525,000 4.750%, 08/15/23 ....................................... Aaa/AAA 531,321 Freemont County, Wyoming School District # 14 355,000 4.500%, 06/15/26 ....................................... NR/BBB 331,882 Frisco, Texas Independent School District 1,260,000 5.000%, 07/15/26 ....................................... Aaa/NR 1,295,293 Galena Park, Texas Independent School District 295,000 4.625%, 08/15/25 ....................................... Aaa/NR 291,953 Harrisburg, South Dakota Independent School District No. 41-2 1,370,000 4.500%, 01/15/24 FSA Insured ........................... NR/AAA 1,335,654 Iron County, Utah School District 1,375,000 4.000%, 01/15/18 ....................................... Aaa/NR 1,320,275 1,260,000 5.000%, 01/15/21 ....................................... Aaa/NR 1,322,395 Jacksboro, Texas Independent School District 815,000 4.700%, 02/15/23 ....................................... NR/AAA 822,783 La Feria, Texas Independent School District 210,000 4.400%, 02/15/24 ....................................... Aaa/NR 203,017 Lancaster, Texas School District 300,000 4.375%, 02/15/22 ....................................... Aaa/AAA 293,487 Lindale, Texas Independent School District 440,000 4.250%, 02/15/21 ....................................... NR/AAA 426,699 1,000,000 4.250%, 02/15/22 ....................................... NR/AAA 965,090 445,000 4.375%, 02/15/23 ....................................... NR/AAA 432,949 Lovejoy, Texas Independent School District 200,000 4.500%, 02/15/24 ....................................... Aaa/AAA 195,640 Muleshoe, Texas Independent School District 380,000 4.500%, 02/15/22 ....................................... NR/AAA 370,838 250,000 4.500%,0 2/15/23 ....................................... NR/AAA 242,617 200,000 4.500%, 02/15/24 ....................................... NR/AAA 193,398 220,000 4.500%, 02/15/25 ....................................... NR/AAA 211,950 Navasota, Texas Independent School District 475,000 5.000%, 08/15/23 FGIC Insured .......................... Aaa/NR 490,171
RATING PRINCIPAL MOODY'S/ AMOUNT GENERAL OBLIGATION BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- SCHOOL DISTRICT (CONTINUED) North Summit County, Utah School District $ 760,000 5.000%, 02/01/23 ....................................... Aaa/NR $ 792,125 800,000 5.000%, 02/01/24 ....................................... Aaa/NR 831,832 Prosper, Texas Independent School District 395,000 4.125%, 08/15/21 ....................................... NR/AAA 377,644 Southern, Texas Independent School District 910,000 4.500%, 02/01/26 ....................................... Aaa/AAA 878,833 Spring, Texas Independent School District 300,000 4.750%, 08/15/23 ....................................... Aaa/AAA 303,636 1,400,000 4.500%, 08/15/27 ....................................... Aaa/AAA 1,346,142 Tooele County, Utah School District 670,000 4.000%, 06/01/20 ....................................... Aaa/AAA 629,030 Van, Texas Independent School District 750,000 4.875%, 02/15/26 ....................................... Aaa/AAA 764,093 Washington County, Utah 440,000 5.000%, 10/01/18 XLCA Insured .......................... Aaa/NR 459,791 465,000 5.000%, 10/01/19 XLCA Insured .......................... Aaa/NR 485,032 490,000 5.000%, 10/01/20 XLCA Insured .......................... Aaa/NR 510,492 510,000 5.000%, 10/01/21 XLCA Insured .......................... Aaa/NR 530,364 535,000 5.000%, 10/01/22 XLCA Insured .......................... Aaa/NR 554,346 565,000 5.000%, 10/01/23 XLCA Insured .......................... Aaa/NR 583,662 320,000 5.000%, 10/01/24 XLCA Insured .......................... Aaa/NR 330,570 Washoe County, Nevada School District 200,000 4.625%, 06/01/23 FGIC Insured .......................... Aaa/AAA 201,172 Waxahachie, Texas Independent School District 605,000 4.400%, 08/15/26 ....................................... Aaa/NR 572,747 630,000 4.400%, 08/15/27 ....................................... Aaa/NR 593,813 Weber County, Utah School District 750,000 5.000%, 06/15/18 ....................................... Aaa/NR 779,040 Yakima County, Washington School District #208 750,000 4.500%, 12/01/23 FSA Insured ........................... Aaa/NR 725,453 ---------------- Total School District .................................. 29,428,793 ---------------- Total General Obligation Bonds ......................... 53,759,730 ----------------
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (75.8%) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- AIRPORT (1.6%) Clark County, Nevada Passenger Facility Charge $ 255,000 4.750%, 07/01/22 MBIA Insured AMT ...................... Aaa/AAA $ 257,188 Hillsborough County, Florida Aviation Authority 2,185,000 5.250%, 10/01/23 MBIA Insured AMT ...................... Aaa/AAA 2,259,902 Miami-Dade County, Florida Aviation Revenue 1,185,000 5.000%, 10/01/28 Series C MBIA Insured AMT ............. Aaa/AAA 1,196,542 ---------------- Total Airport .......................................... 3,713,632 ---------------- COUNTY (0.5%) Davis County, Utah Lease Revenue DMV Project 78,000 5.400%, 11/01/17 ....................................... NR/NR* 78,052 83,000 5.450%, 11/01/18 ....................................... NR/NR* 83,054 87,000 5.500%, 11/01/19 ....................................... NR/NR* 87,055 92,000 5.550%, 11/01/20 ....................................... NR/NR* 92,058 97,000 5.600%, 11/01/21 ....................................... NR/NR* 97,058 103,000 5.650%, 11/01/22 ....................................... NR/NR* 103,064 108,000 5.700%, 11/01/23 ....................................... NR/NR* 108,072 115,000 5.700%, 11/01/24 ....................................... NR/NR* 115,078 121,000 5.750%, 11/01/25 ....................................... NR/NR* 121,074 128,000 5.750%, 11/01/26 ....................................... NR/NR* 128,069 ---------------- Total County ........................................... 1,012,634 ---------------- EDUCATION (13.1%) Broward County, Florida School Board COP 1,680,000 4.500%, 07/01/23 Series A FGIC Insured ................. Aaa/AAA 1,649,928 Carmel, Indiana 2002 School Building Corp. 1,235,000 4.300%, 01/15/23 FSA Insured ........................... NR/AAA 1,183,142 1,525,000 4.300%, 07/15/23 FSA Insured ........................... NR/AAA 1,459,730 Clinton Prairie, Indiana Community School Building 675,000 4.625%, 01/15/19 FGIC Insured .......................... Aaa/AAA 686,542 Florida State Board of Education Public Education 210,000 4.500%, 06/01/25 FSA Insured ........................... Aaa/AAA 204,945 Hillsborough County, Florida School Board COP 560,000 4.250%, 07/01/26 MBIA Insured .......................... Aaa/AAA 516,886
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- EDUCATION (CONTINUED) Laredo, Texas Independent School District Public Facility Corp. $ 190,000 5.000%, 08/01/24 AMBAC Insured ......................... Aaa/AAA $ 194,986 Nevada System Higher Education COP 1,000,000 5.000%, 07/01/25 AMBAC Insured ......................... Aaa/AAA 1,037,090 Salt Lake County, Utah Westminster College Project 115,000 5.050%, 10/01/10 (pre-refunded) ........................ NR/BBB 118,882 100,000 5.500%, 10/01/19 (pre-refunded) ........................ NR/BBB 104,331 435,000 4.750%, 10/01/21 ....................................... NR/BBB 428,775 1,200,000 5.000%, 10/01/22 ....................................... NR/BBB 1,206,348 1,250,000 5.000%, 10/01/25 ....................................... NR/BBB 1,250,738 1,000,000 5.750%, 10/01/27 (pre-refunded) ........................ NR/BBB 1,014,460 Texas State College Student Loan Revenue 100,000 5.000%, 08/01/22 AMT ................................... Aa1/AA 101,502 Texas State University System Financing Revenue 655,000 4.375%, 03/15/23 FSA Insured ........................... Aaa/AAA 631,512 Tyler, Texas Independent School District 325,000 5.000%, 02/15/26 FSA Insured ........................... Aaa/AAA 334,727 University of Nevada (University Revenues) 190,000 4.500%, 07/01/24 MBIA Insured .......................... Aaa/AAA 189,552 University of Utah COP 3,170,000 4.350%, 12/01/26 AMBAC Insured ......................... Aaa/AAA 2,965,377 University of Utah (University Revenues) 770,000 5.000%, 04/01/18 MBIA Insured .......................... Aaa/AAA 807,183 Utah County, Utah Charter School Revenue Lakeview Academy 315,000 5.350%, 07/15/17 Series A .............................. NR/NR* 314,751 Utah County, Utah Charter School Revenue Lincoln Academy 450,000 5.450%, 06/15/17 Series A + ............................ NR/NR* 451,697 Utah County, Utah Charter School Revenue Renaissance Academy 340,000 5.350%, 07/15/17 Series A .............................. NR/NR* 337,912 Utah County, Utah School Facility 1,400,000 6.500%, 12/01/25 ....................................... NR/NR* 1,400,560
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- EDUCATION (CONTINUED) Utah State Board of Regents Auxiliary & Campus Facility $ 1,000,000 4.125%, 04/01/20 MBIA Insured .......................... Aaa/AAA $ 950,490 Utah State Board of Regents Dixie State College 120,000 5.500%, 05/01/14 MBIA Insured .......................... Aaa/AAA 128,087 130,000 5.500%, 05/01/15 MBIA Insured .......................... Aaa/AAA 138,644 400,000 5.100%, 05/01/21 MBIA Insured .......................... Aaa/AAA 412,900 Utah State Board of Regents Lease Revenue 410,000 4.500%, 05/01/20 AMBAC Insured ......................... Aaa/AAA 411,460 425,000 4.500%, 05/01/21 AMBAC Insured ......................... Aaa/AAA 425,281 450,000 4.625%, 05/01/22 AMBAC Insured ......................... Aaa/AAA 453,056 120,000 4.650%, 05/01/23 AMBAC Insured ......................... Aaa/AAA 120,770 Utah State Board of Regents Office Facility Revenue 450,000 5.050%, 02/01/20 MBIA Insured .......................... Aaa/AAA 463,109 360,000 5.125%, 02/01/22 MBIA Insured .......................... Aaa/AAA 371,743 Utah State Board of Regents 2,885,000 4.500%, 08/01/18 MBIA Insured .......................... Aaa/AAA 2,900,435 250,000 5.250%, 04/01/24 MBIA Insured .......................... Aaa/AAA 267,675 500,000 5.000%, 05/01/26 ....................................... Aa/AAA 516,170 Utah State Board of Regents (University of Utah) 1,045,000 5.000%, 04/01/23 MBIA Insured .......................... Aaa/AAA 1,080,133 Weber State University, Utah 1,825,000 4.400%, 04/01/27 FSA Insured ........................... NR/AAA 1,730,191 Weber State University, Utah Student Facilities System 300,000 5.100%, 04/01/16 Series A .............................. NR/AA 313,563 425,000 5.250%, 04/01/19 Series A .............................. NR/AA 446,684 ---------------- Total Education ........................................ 29,721,947 ---------------- HEALTHCARE (0.4%) Harris County, Texas Health Facility Development Corp. 145,000 5.000%, 11/15/28 AMBAC Insured ......................... NR/AAA 146,869 Lee Memorial Health System, Florida Hospital Revenue 450,000 4.250%, 04/01/22 MBIA Insured .......................... Aaa/AAA 428,472
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- HEALTHCARE (CONTINUED) Tarrant County, Texas Health Facilities Revenue $ 225,000 5.000%, 02/15/26 MBIA Insured (pre-refunded) ........... Aaa/AAA $ 228,861 ---------------- Total Healthcare ....................................... 804,202 ---------------- HOUSING (11.0%) Alaska Housing Finance Corp. Housing Revenue 1,000,000 4.700%, 06/01/27 AMT ................................... Aa2/AA 964,850 Florida Housing Finance Corp. Revenue 435,000 4.750%, 01/01/16 AMT ................................... Aa2/AA 438,323 790,000 5.000%, 07/01/21 AMT ................................... Aa2/AA 796,517 1,610,000 4.550%, 07/01/22 AMT ................................... Aa1/AA 1,563,970 Henderson, Nevada Local Improvement District 150,000 5.000%, 09/01/15 ....................................... NR/NR* 153,214 200,000 5.000%, 09/01/16 ....................................... NR/NR* 204,260 200,000 5.050%, 09/01/17 ....................................... NR/NR* 203,808 200,000 5.100%, 09/01/18 ....................................... NR/NR* 204,256 Indiana Housing & Community Development Authority 1,485,000 4.900%, 07/01/26 AMT ................................... Aaa/NR 1,477,724 Indiana State Housing Finance Authority Single Family 245,000 4.850%, 07/01/22 AMT ................................... Aaa/NR 244,740 Indianapolis, Indiana Multi-Family 500,000 4.850%, 01/01/21 AMT ................................... Aaa/NR 502,625 Miami-Dade County, Florida Housing Finance Authority 535,000 5.000%, 11/01/23 FSA Insured AMT ....................... NR/AAA 539,580 Nevada Housing Multi-Family LOC US Bank 1,000,000 4.750%, 04/01/39 AMT ................................... NR/AA 978,050 Orange County, Florida Housing Finance Authority 205,000 5.150%, 03/01/22 ....................................... Aaa/NR 207,023 Provo City, Utah Housing Authority 500,000 5.800%, 07/20/22 GNMA Collateralized ................... Aaa/NR 509,020 Seattle, Washington Housing Authority 730,000 4.400%, 11/01/21 AMT ................................... NR/AAA 702,895
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- HOUSING (CONTINUED) Snohomish County, Washington Housing Authority $ 185,000 4.875%, 09/01/12 AMT ................................... NR/NR* $ 184,863 225,000 5.000%, 09/01/13 AMT ................................... NR/NR* 225,576 185,000 5.000%, 09/01/14 AMT ................................... NR/NR* 185,098 145,000 5.100%, 09/01/15 AMT ................................... NR/NR* 145,565 South Dakota Housing Development Authority 1,250,000 4.900%, 05/01/26 AMT ................................... Aa1/AAA 1,243,838 Texas State Housing Revenue 500,000 4.800%, 09/01/27 AMT ................................... Aa1/AAA 486,120 Utah Housing Corporation Single Family Housing 250,000 4.000%, 07/01/11 AMT ................................... Aaa/AAA 245,755 55,000 5.250%, 07/01/23 AMT ................................... Aa2/AA 55,513 650,000 5.000%, 01/01/32 AMT ................................... Aa2/AA 649,084 Utah Housing Corporation Single Family Mortgage 230,000 4.000%, 07/01/11 AMT ................................... Aaa/AAA 227,491 335,000 4.600%, 07/01/15 AMT ................................... Aaa/AAA 336,474 240,000 4.650%, 07/01/16 AMT ................................... Aaa/AAA 241,356 245,000 4.875%, 07/01/23 AMT ................................... Aa3/AA- 242,185 1,245,000 5.000%, 07/01/25 AMT ................................... Aa3/AA- 1,248,548 820,000 5.100%, 01/01/26 AMT ................................... Aa3/AA- 826,896 975,000 5.000%, 07/01/31 AMT ................................... Aa2/AA 976,804 Utah State Housing Agency Housing Revenue 135,000 5.650%, 07/01/27 AMT ................................... Aa2/AA 137,942 Utah State Housing Corporation Single Family Housing Revenue 1,635,000 5.125%, 07/01/24 AMT ................................... Aa3/AA- 1,660,751 Utah State Housing Finance Agency 225,000 5.700%, 07/01/15 AMT ................................... Aa3/AA- 228,508 120,000 5.650%, 07/01/16 Series 1994C .......................... Aaa/AAA 120,812 40,000 5.400%, 07/01/16 AMT ................................... Aa2/AA 40,206 60,000 6.000%, 07/01/17 AMT ................................... Aaa/AA 60,610 740,000 5.500%, 07/01/18 AMT ................................... Aa3/AA- 755,954 75,000 5.300%, 07/01/18 AMT ................................... Aaa/AAA 77,138
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- HOUSING (CONTINUED) Utah State Housing Finance Agency (continued) $ 90,000 5.000%, 07/01/18 AMT ................................... Aaa/AAA $ 90,694 145,000 5.400%, 07/01/20 AMT ................................... Aa2/AA 147,074 360,000 5.600%, 07/01/23 AMT ................................... Aa2/AA 364,979 75,000 5.700%, 07/01/26 MBIA Insured .......................... Aaa/AAA 75,029 Washington State Housing Finance Commission 2,290,000 4.800%, 12/01/21 AMT ................................... Aaa/NR 2,268,772 Wyoming Community Development Authority Housing Revenue 150,000 4.600%, 12/01/12 AMT ................................... Aa1/AA+ 150,582 225,000 4.350%, 12/01/16 AMT ................................... Aa1/AA+ 221,074 580,000 4.700%, 06/01/17 AMT ................................... Aa1/AA+ 584,176 520,000 4.700%, 12/01/17 AMT ................................... Aa1/AA+ 523,744 120,000 5.000%, 12/01/22 ....................................... Aa1/AA+ 121,468 ---------------- Total Housing .......................................... 24,841,534 ---------------- INDUSTRIAL DEVELOPMENT & POLLUTION CONTROL (0.5%) Sandy City, Utah Industrial Development, H Shirley Wright Project, Refunding Bonds, LOC Olympus Bank 250,000 6.125%, 08/01/16 ....................................... NR/AAA 250,420 Utah County Environmental Improvement Revenue 935,000 5.050%, 11/01/17 ....................................... Baa1/BBB+ 966,136 ---------------- Total Industrial Development & Pollution Control ....... 1,216,556 ---------------- LEASE (8.9%) Celebration Community Development District, Florida 290,000 5.000%, 05/01/22 MBIA Insured .......................... Aaa/AAA 299,286 Clark County, Nevada Improvement District Revenue 740,000 5.125%, 12/01/19 ....................................... NR/NR* 747,755 Clark County, Nevada Improvement District Special Local Improvement # 128 (Summerlin) 500,000 5.000%, 02/01/21Series A ............................... NR/NR* 493,680
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- LEASE (CONTINUED) Marion County, Indiana Convention & Recreational Facilities Authority $ 390,000 5.000%, 06/01/27 MBIA Insured .......................... Aaa/AAA $ 394,286 Murray City, Utah Municipal Building Authority 520,000 5.050%, 12/01/15 AMBAC Insured ......................... Aaa/NR 543,332 New Albany, Indiana Development Authority 500,000 4.250%, 02/01/22 ....................................... NR/A- 461,750 Red River, Texas Higher Education TCU Project 1,000,000 4.375%, 03/15/25 ....................................... Aa3/NR 936,980 Salt Lake County, Utah Municipal Building Authority 3,900,000 5.200%, 10/15/20 AMBAC Insured (pre-refunded) .......... Aaa/AAA 4,093,050 South Dakota State Building Authority Revenue 500,000 4.500%, 06/01/24 FGIC Insured NR/AAA 490,120 Spanish Fork, Utah Charter School 2,000,000 5.550%, 11/15/21 ....................................... NR/NR* 2,033,140 Springville, Utah 34,000 5.650%, 01/15/18 ....................................... NR/NR* 34,020 37,000 5.800%, 01/15/19 ....................................... NR/NR* 37,020 38,000 5.900%, 01/15/20 ....................................... NR/NR* 38,022 40,000 6.000%, 01/15/21 ....................................... NR/NR* 40,026 Utah County, Utah Municipal Building Authority 120,000 5.500%, 11/01/16 AMBAC Insured ......................... Aaa/NR 127,415 240,000 5.500%, 11/01/17 AMBAC Insured ......................... Aaa/NR 254,830 Utah State Building Ownership Authority 465,000 5.000%, 05/15/21 ....................................... Aa1/AA+ 483,879 1,755,000 5.250%, 05/15/23 ....................................... Aa1/AA+ 1,842,417 510,000 5.000%, 05/15/23 ....................................... Aa1/AA+ 528,437 1,845,000 5.250%, 05/15/24 ....................................... Aa1/AA+ 1,934,685 1,080,000 5.000%, 05/15/25 ....................................... Aa1/AA+ 1,112,152 Washington County - St. George, Utah Interlocal Agency Revenue 1,000,000 5.125%, 12/01/17 AMBAC Insured ......................... NR/AAA 1,014,580 100,000 5.125%, 12/01/22 AMBAC Insured ......................... NR/AAA 101,405 West Bountiful, Utah Courthouse Revenue 410,000 5.000%, 05/01/19 NR/A- 427,462
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- LEASE (CONTINUED) West Valley City, Utah Municipal Building Authority Lease Revenue Refunding $ 1,890,000 4.375%, 08/01/26 Series A FGIC Insured ................. Aaa/AAA $ 1,803,967 ---------------- Total Lease ............................................ 20,273,696 ---------------- TAX REVENUE (19.5%) Bay County, Florida Sales Tax Revenue 175,000 4.750%, 09/01/23 FSA Insured ........................... Aaa/NR 175,878 Bluffdale City, Utah Series 2004 295,000 6.000%, 12/01/13 ....................................... NR/NR* 299,832 310,000 6.000%, 12/01/14 ....................................... NR/NR* 315,533 330,000 6.000%, 12/01/15 ....................................... NR/NR* 330,323 350,000 6.000%, 12/01/16 ....................................... NR/NR* 350,329 370,000 6.000%, 12/01/17 NR/NR* 370,318 395,000 6.000%, 12/01/18 ....................................... NR/NR* 395,308 420,000 6.000%, 12/01/19 ....................................... NR/NR* 420,294 Bluffdale, Utah Sales Tax Revenue 1,975,000 5.500%, 08/01/23 ....................................... NR/NR* 1,999,925 Bountiful, Utah Special Improvement District Special Assessment Revenue 203,000 5.000%, 06/01/14 ....................................... NR/NR* 202,405 213,000 5.150%, 06/01/15 ....................................... NR/NR* 213,030 224,000 5.300%, 06/01/16 ....................................... NR/NR* 224,038 236,000 5.500%, 06/01/17 ....................................... NR/NR* 236,142 249,000 5.650%, 06/01/18 NR/NR* 249,219 Cache County, Utah Sales Tax Revenue 855,000 5.000%, 12/15/19 FGIC Insured .......................... Aaa/AAA 896,869 Clark County, Nevada Improvement District 250,000 5.000%, 08/01/16 ....................................... NR/NR* 254,565 Coral Canyon, Utah Special Service District 110,000 5.000%, 07/15/13 ....................................... NR/NR* 112,077 250,000 5.500%, 07/15/18 NR/NR* 257,350 Fishers, Indiana Redevelopment Authority Lease Revenue 175,000 4.500%, 07/15/20 AMBAC Insured ......................... Aaa/AAA 175,639
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- TAX REVENUE (CONTINUED) Henderson, Nevada Local Improvement District $ 100,000 4.500%, 09/01/12 ....................................... NR/NR* $ 99,404 300,000 5.000%, 09/01/14 ....................................... NR/NR* 304,851 300,000 5.000%, 09/01/15 ....................................... NR/NR* 303,789 Holladay, Utah Redevelopment Agency 3,000,000 4.900%, 12/30/20 NR/NR* 2,972,880 Jordanelle, Utah Special Service District 186,000 5.000%, 11/15/14 ....................................... NR/NR* 186,839 196,000 5.100%, 11/15/15 ....................................... NR/NR* 197,088 206,000 5.200%, 11/15/16 ....................................... NR/NR* 207,061 216,000 5.300%, 11/15/17 ....................................... NR/NR* 217,138 228,000 5.400%, 11/15/18 ....................................... NR/NR* 229,261 240,000 5.500%, 11/15/19 ....................................... NR/NR* 241,325 253,000 5.600%, 11/15/20 ....................................... NR/NR* 254,361 268,000 5.700%, 11/15/21 ....................................... NR/NR* 269,439 283,000 5.800%, 11/15/22 ....................................... NR/NR* 284,520 299,000 6.000%, 11/15/23 ....................................... NR/NR* 300,639 Jordanelle, Utah Special Service Improvement District 275,000 8.000%, 10/01/11 ....................................... NR/NR* 284,710 La Verkin, Utah Sales and Franchise Tax Revenue 571,000 5.100%, 07/15/27 ....................................... NR/NR* 582,106 Lehi, Utah Sales Tax 610,000 5.000%, 06/01/21 FSA Insured ........................... Aaa/AAA 634,516 790,000 5.000%, 06/01/24 FSA Insured ........................... Aaa/AAA 816,504 Mesquite, Nevada New Special Improvement District 185,000 4.600%, 08/01/11 ....................................... NR/NR* 184,384 195,000 4.750%, 08/01/12 ....................................... NR/NR* 193,779 230,000 4.900%, 08/01/13 ....................................... NR/NR* 229,395 140,000 5.250%, 08/01/17 ....................................... NR/NR* 140,267 315,000 5.350%, 08/01/19 ....................................... NR/NR* 315,598 135,000 5.400%, 08/01/20 ....................................... NR/NR* 135,432 500,000 5.500%, 08/01/25 ....................................... NR/NR* 501,590 Mountain Regional Water District, Utah Special Assessment 1,800,000 7.000%, 12/01/18 ....................................... NR/NR* 1,835,910
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- TAX REVENUE (CONTINUED) Mountain Regional Water, Utah Special Service District $ 2,000,000 5.000%, 12/15/20 MBIA Insured .......................... Aaa/AAA $ 2,073,460 North Ogden, Utah Sales Tax Revenue 195,000 5.000%, 11/01/24 XLCA Insured .......................... Aaa/AAA 200,891 Payson City Utah Sales Tax Revenue 445,000 5.000%, 08/01/21 FSA Insured NR/AAA 463,427 Plainfield, Indiana Independent Redevelopment Authority 1,070,000 4.375%, 08/01/20 CIFG Assurance North America, Inc. Insured ........................................ Aaa/NR 1,048,568 Salt Lake City, Utah Sales Tax 265,000 5.250%, 02/01/13 ....................................... NR/AAA 278,594 1,320,000 5.250%, 02/01/15 ....................................... NR/AAA 1,382,660 100,000 5.250%, 02/01/17 ....................................... NR/AAA 104,578 Salt Lake County, Utah Sales Tax 955,000 5.000%, 02/01/21 ....................................... NR/AAA 995,282 1,725,000 5.000%, 08/01/21 ....................................... NR/AAA 1,801,780 1,005,000 5.000%, 02/01/22 ....................................... NR/AAA 1,045,411 1,060,000 5.000%, 02/01/23 ....................................... NR/AAA 1,100,545 1,115,000 5.000%, 02/01/24 ....................................... NR/AAA 1,156,199 Sandy City, Utah Sales Tax 520,000 5.000%, 09/15/18 AMBAC Insured ......................... Aaa/AAA 537,243 605,000 5.000%, 09/15/20 AMBAC Insured ......................... Aaa/AAA 623,356 South Jordan, Utah Sales Tax 570,000 5.000%, 08/15/15 AMBAC Insured ......................... Aaa/AAA 592,920 South Jordan, Utah Special Assignment 1,000,000 6.875%, 11/01/17 ....................................... NR/NR* 1,015,240 South Weber City, Utah 525,000 5.000%, 01/15/24 MBIA Insured .......................... Aaa/AAA 540,897 Springville, Utah Special Improvement District 400,000 5.500%, 01/15/17 ....................................... NR/NR* 400,220 423,000 5.650%, 01/15/18 ....................................... NR/NR* 423,254 446,000 5.800%, 01/15/19 ....................................... NR/NR* 446,241 472,000 5.900%, 01/15/20 ....................................... NR/NR* 472,278 500,000 6.000%, 01/15/21 ....................................... NR/NR* 500,320
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- TAX REVENUE (CONTINUED) Utah Water Finance Agency $ 775,000 5.100%, 07/01/18 AMBAC Insured ......................... Aaa/NR $ 806,093 510,000 5.000%, 07/01/18 AMBAC Insured ......................... Aaa/NR 529,487 685,000 5.000%, 07/01/19 AMBAC Insured ......................... Aaa/NR 711,174 Wasatch County, Utah Building Authority 130,000 5.000%, 10/01/15 ....................................... A3/NR 133,067 135,000 5.000%, 10/01/16 ....................................... A3/NR 137,890 Wasatch County, Utah Sales Tax 205,000 5.000%, 12/01/16 AMBAC Insured ......................... Aaa/AAA 213,555 210,000 5.000%, 12/01/17 AMBAC Insured ......................... Aaa/AAA 217,938 225,000 5.000%, 12/01/18 AMBAC Insured ......................... Aaa/AAA 232,736 Washington City, Utah Sales Tax 680,000 5.250%, 11/15/17 AMBAC Insured ......................... Aaa/AAA 721,018 Weber County, Utah Sales Tax 385,000 5.000%, 07/01/23 AMBAC Insured ......................... Aaa/NR 396,839 West Valley City, Utah Redevelopment Agency 1,625,000 5.000%, 03/01/21 ....................................... NR/A- 1,656,996 320,000 5.000%, 03/01/22 ....................................... NR/A- 325,680 350,000 5.000%, 03/01/23 NR/A- 355,541 1,000,000 5.000%, 03/01/24 ....................................... NR/A- 1,014,540 West Valley City, Utah Sales Tax 250,000 5.000%, 07/15/20 AMBAC Insured ......................... Aaa/AAA 257,948 ---------------- Total Tax Revenue ...................................... 44,315,726 ---------------- TRANSPORTATION (3.6%) Florida State Turnpike Authority Turnpike Revenue 500,000 4.500%, 07/01/22 MBIA Insured .......................... Aaa/AAA 502,080 Port of Seattle, Washington Revenue 655,000 5.100%, 04/01/24 AMT FGIC Insured ...................... Aaa/AAA 660,659 Utah Transit Authority Sales Tax & Transportation Revenue 3,300,000 4.125%, 06/15/21 FSA Insured ........................... Aaa/AAA 3,192,717 3,450,000 4.125%, 06/15/22 FSA Insured ........................... Aaa/AAA 3,265,632 590,000 5.000%, 06/15/24 FSA Insured ........................... Aaa/AAA 618,892 ---------------- Total Transportation ................................... 8,239,980 ----------------
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- UTILITY (10.0%) Alaska Industrial Development & Export Authority $ 400,000 4.625%, 12/01/16 AMBAC Insured AMT ..................... NR/AAA $ 401,804 Cowlitz County, Washington Public Utility District Electric Revenue 1,000,000 4.500%, 09/01/26 MBIA Insured .......................... Aaa/AAA 969,950 Eagle Mountain, Utah Gas & Electric 1,385,000 4.250%, 06/01/20 Radian Insured ........................ Aa3/AA 1,314,143 1,440,000 5.000%, 06/01/21 Radian Insured ........................ Aa3/AA 1,469,146 1,515,000 5.000%, 06/01/22 Radian Insured ........................ Aa3/AA 1,542,649 Garland, Texas Water & Sewer 440,000 4.500%, 03/01/21 AMBAC Insured ......................... Aaa/AAA 438,200 Indianapolis, Indiana Gas Utility 290,000 5.000%, 08/15/24 AMBAC Insured ......................... Aaa/AAA 291,885 Intermountain Power Agency Utilities Light & Power Service, Utah 775,000 5.000%, 07/01/18 FSA Insured ........................... Aaa/AAA 806,690 1,380,000 5.000%, 07/01/19 MBIA Insured .......................... Aaa/AAA 1,415,383 Lower Colorado River Authority, Texas 175,000 5.000%, 05/15/26 FSA Insured ........................... Aaa/AAA 179,056 Manti City, Utah Electric System Revenue 603,000 5.750%, 02/01/17 ....................................... NR/NR* 625,444 Murray City, Utah Utility Electric Revenue 1,340,000 5.000%, 06/01/25 AMBAC Insured ......................... Aaa/NR 1,385,761 Rockport, Indiana Pollution Control Revenue Indiana Michigan Power Company Project 1,000,000 4.625%, 06/01/25 Series A FGIC Insured ................. Aaa/AAA 983,810 St. George, Utah Electric Revenue 1,910,000 4.500%, 06/01/20 FSA Insured ........................... Aaa/NR 1,916,227 Salem, Utah Electric Revenue 125,000 5.300%, 11/01/07 ....................................... NR/NR* 125,180 130,000 5.350%, 11/01/08 NR/NR* 131,095 140,000 5.400%, 11/01/09 NR/NR* 141,448 Santa Clara Utah Storm Drain Revenue 877,000 5.100%, 09/15/26 NR/NR* 890,348 Seattle, Washington Municipal Light & Power 1,360,000 4.500%, 08/01/19 FSA Insured ........................... Aaa/AAA 1,366,501
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- UTILITY (CONTINUED) Southern Utah Valley Power System $ 210,000 5.250%, 09/15/13 MBIA Insured .......................... Aaa/AAA $ 221,787 225,000 5.250%, 09/15/14 MBIA Insured .......................... Aaa/AAA 238,601 235,000 5.250%, 09/15/15 MBIA Insured .......................... Aaa/AAA 249,093 185,000 5.125%, 09/15/21 MBIA Insured .......................... Aaa/AAA 192,200 Springville, Utah Electric Revenue 550,000 5.600%, 03/01/09 ....................................... Baa1/NR 559,686 Tacoma, Washington Solid Waste Utility Revenue 1,000,000 5.000%, 12/01/23 XLCA Insured .......................... Aaa/AAA 1,037,180 Utah Assessed Municipal Power System 790,000 5.250%, 12/01/09 ....................................... NR/A- 803,872 1,000,000 5.000%, 04/01/21 FSA Insured ........................... Aaa/AAA 1,032,630 Utah Water Finance Agency Revenue 1,000,000 4.500%, 10/01/28 AMBAC Insured ......................... Aaa/NR 957,690 Washington, Utah Electric Revenue 985,000 5.000%, 09/01/21 XLCA Insured .......................... Aaa/NR 1,020,884 ---------------- Total Utility .......................................... 22,708,343 ---------------- WATER AND SEWER (6.7%) Ashley Valley, Utah 40,000 9.500%, 01/01/08 AMBAC Insured ......................... Aaa/AAA 41,102 Eagle Mountain, Utah Water and Sewer 750,000 5.800%, 11/15/16 ACA Insured ........................... NR/A 779,842 Granger and Hunter, Utah Improvement District 350,000 5.000%, 03/01/18 FSA Insured (pre-refunded) ............ Aaa/NR 352,835 Jordan Valley, Utah Water Conservancy District 715,000 4.375%, 10/01/18 AMBAC Insured ......................... Aaa/AAA 712,133 Mesquite, Texas Waterworks & Sewer 225,000 4.500%, 03/01/24 FSA Insured ........................... Aaa/AAA 219,321 Murray City, Utah Sewer and Water 465,000 5.000%, 10/01/17 AMBAC Insured ......................... Aaa/NR 484,944 390,000 5.000%, 10/01/18 AMBAC Insured ......................... Aaa/NR 405,206 440,000 5.000%, 10/01/19 AMBAC Insured ......................... Aaa/NR 456,425 North Davis County, Utah Sewer District 1,350,000 5.000%, 03/01/21 AMBAC Insured ......................... Aaa/NR 1,400,166
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- WATER AND SEWER (CONTINUED) Orem, Utah Water & Storm Sewer Revenue $ 1,720,000 4.500%, 07/15/17 MBIA Insured .......................... Aaa/AAA $ 1,740,795 Pleasant Grove, Utah Water Revenue 450,000 4.300%, 12/01/20 MBIA Insured .......................... Aaa/AAA 436,585 Salt Lake City, Utah Metropolitan Water Revenue 1,200,000 5.375%, 07/01/24 AMBAC Insured (pre-refunded) .......... Aaa/AAA 1,235,412 125,000 5.375%, 07/01/29 AMBAC Insured (pre-refunded) .......... Aaa/AAA 128,689 South Valley, Utah Water Reclamation Facility 710,000 4.375%, 08/15/18 ....................................... NR/AAA 707,188 Smithfield, Utah Water Revenue 90,000 4.750%, 06/01/17 ....................................... NR/NR* 89,631 94,000 4.800%, 06/01/18 ....................................... NR/NR* 93,594 99,000 4.850%, 06/01/19 ....................................... NR/NR* 98,368 103,000 4.900%, 06/01/20 ....................................... NR/NR* 102,305 108,000 5.000%, 06/01/21 ....................................... NR/NR* 107,236 114,000 5.050%, 06/01/22 ....................................... NR/NR* 113,169 120,000 5.100%, 06/01/23 ....................................... NR/NR* 119,090 126,000 5.150%, 06/01/24 ....................................... NR/NR* 125,011 132,000 5.200%, 06/01/25 ....................................... NR/NR* 130,931 139,000 5.250%, 06/01/26 ....................................... NR/NR* 137,842 Upper Trinity Regional Water District, Texas 205,000 4.500%, 08/01/20 AMBAC Insured ......................... Aaa/AAA 204,994 Utah Water Finance Agency Revenue 100,000 5.000%, 06/01/14 MBIA Insured .......................... Aaa/AAA 101,117 200,000 5.250%, 07/01/16 AMBAC Insured ......................... Aaa/NR 210,466 310,000 5.000%, 10/01/17 AMBAC Insured ......................... Aaa/NR 322,716 465,000 5.250%, 10/01/18 AMBAC Insured (pre-refunded) .......... Aaa/NR 492,421 285,000 5.250%, 10/01/18 AMBAC Insured (unrefunded) ............ Aaa/NR 299,387 360,000 5.000%, 10/01/20 AMBAC Insured (pre-refunded) .......... Aaa/NR 377,014 105,000 5.000%, 10/01/20 AMBAC Insured (unrefunded) ............ Aaa/NR 108,575 830,000 4.500%, 10/01/22 AMBAC Insured ......................... Aaa/NR 823,617 100,000 5.125%, 07/01/23 AMBAC Insured ......................... Aaa/NR 103,532 870,000 4.500%, 10/01/23 AMBAC Insured ......................... Aaa/NR 860,065 250,000 5.500%, 10/01/29 AMBAC Insured (pre-refunded) .......... Aaa/AAA 258,915
RATING PRINCIPAL MOODY'S/ AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE - --------------- --------------------------------------------------------- -------- ---------------- WATER AND SEWER (CONTINUED) Weber-Box Elder, Utah Conservation District Water Revenue $ 200,000 6.450%, 11/01/14 (pre-refunded) ........................ Baa3/NR $ 215,346 200,000 6.500%, 11/01/19 (pre-refunded) ........................ Baa3/NR 215,654 335,000 6.900%, 11/01/20 (pre-refunded) ........................ Baa3/NR 365,354 ---------------- Total Water and Sewer .................................. 15,176,993 ---------------- Total Revenue Bonds .................................... 172,025,243 ---------------- Total Investments (cost $226,833,830 - note 4) ......... 99.5% 225,784,973 Other assets less liabilities .......................... 0.5 1,138,153 ----- ---------------- Net Assets ............................................. 100.0% $ 226,923,126 ===== ================ PERCENT OF PORTFOLIO DISTRIBUTION BY QUALITY RATING (UNAUDITED) PORTFOLIO -------------------------------------------------------- --------- Aaa of Moody's or AAA of S&P ........................... 67.8% Aa of Moody's or AA of S&P ............................. 11.8 A of Moody's or S&P .................................... 2.7 Baa of Moody's or BBB of S&P ........................... 3.0 Not rated* ............................................. 14.7 ----- 100.0% =====
* Any security not rated (NR) by either credit rating service must be determined by the Manager to have sufficient quality to be ranked in the top four ratings if a credit rating were to be assigned by a rating service. + Security traded on a "when-issued" basis. ++ This security is pledged as collateral for the Fund's when- issued commitments. PORTFOLIO ABBREVIATIONS: ------------------------ ACA - American Capital Assurance Financial Guaranty Corp. AMBAC - American Municipal Bond Assurance Corp. AMT - Alternative Minimum Tax CIFG - CDC IXIS Financial Guaranty COP - Certificates of Participation FGIC - Financial Guaranty Insurance Co. FSA - Financial Security Assurance GNMA - Government National Mortgage Association LOC - Letter of Credit MBIA - Municipal Bond Investors Assurance NR - Not Rated XLCA - XL Capital Assurance See accompanying notes to financial statements. TAX-FREE FUND FOR UTAH STATEMENT OF ASSETS AND LIABILITIES JUNE 30, 2007 ASSETS Investments at value (cost $226,833,830) .............................................................. $ 225,784,973 Interest receivable ................................................................................... 3,286,687 Receivable for Fund shares sold ....................................................................... 889,356 Other assets .......................................................................................... 15,124 ------------- Total assets .......................................................................................... 229,976,140 ------------- LIABILITIES Cash overdraft .......................................................................................... 281,371 Payable for Fund shares redeemed ........................................................................ 1,485,991 Payable for investment securities purchased ............................................................. 893,888 Dividends payable ....................................................................................... 175,158 Distribution and service fees payable ................................................................... 50,245 Management fees payable ................................................................................. 37,327 Accrued expenses ........................................................................................ 129,034 ------------- Total liabilities ....................................................................................... 3,053,014 ------------- NET ASSETS ................................................................................................. $ 226,923,126 ============= Net Assets consist of: Capital Stock - Authorized an unlimited number of shares, par value $0.01 per share ..................... $ 228,862 Additional paid-in capital .............................................................................. 229,412,776 Net unrealized depreciation on investments (note 4) ..................................................... (1,048,857) Accumulated net realized loss on investments ............................................................ (1,704,433) Undistributed net investment income ..................................................................... 34,778 ------------- $ 226,923,126 ============= CLASS A Net Assets .............................................................................................. $ 148,894,165 ============= Capital shares outstanding .............................................................................. 15,025,729 ============= Net asset value and redemption price per share .......................................................... $ 9.91 ============= Offering price per share (100/96 of $9.91 adjusted to nearest cent) ..................................... $ 10.32 ============= CLASS C Net Assets .............................................................................................. $ 30,905,054 ============= Capital shares outstanding .............................................................................. 3,119,919 ============= Net asset value and offering price per share ............................................................ $ 9.91 ============= Redemption price per share (*a charge of 1% is imposed on the redemption proceeds of the shares, or on the original price, whichever is lower, if redeemed during the first 12 months after purchase) ........................................................... $ 9.91* ============= CLASS Y Net Assets .............................................................................................. $ 47,123,907 ============= Capital shares outstanding .............................................................................. 4,740,505 ============= Net asset value, offering and redemption price per share ................................................ $ 9.94 =============
See accompanying notes to financial statements. TAX-FREE FUND FOR UTAH STATEMENT OF OPERATIONS YEAR ENDED JUNE 30, 2007 INVESTMENT INCOME: Interest income ............................................................... $ 10,153,461 Expenses: Management fee (note 3) ....................................................... $ 1,110,710 Distribution and service fees (note 3) ........................................ 615,527 Transfer and shareholder servicing agent fees ................................. 167,771 Trustees' fees and expenses (note 8) .......................................... 87,872 Legal fees (note 3) ........................................................... 85,893 Shareholders' reports and proxy statements .................................... 81,638 Fund accounting fees .......................................................... 49,082 Custodian fees ................................................................ 35,167 Registration fees and dues .................................................... 30,785 Auditing and tax fees ......................................................... 19,963 Insurance ..................................................................... 14,951 Chief compliance officer (note 3) ............................................. 4,543 Miscellaneous ................................................................. 40,223 ----------- Total expenses ................................................................ 2,344,125 Management fee waived (note 3) ................................................ (666,428) Expenses paid indirectly (note 6) ............................................. (35,773) ----------- Net expenses .................................................................. 1,641,924 ------------ Net investment income ......................................................... 8,511,537 REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) from securities transactions ......................... 686,688 Change in unrealized depreciation on investments .............................. 310,980 ----------- Net realized and unrealized gain (loss) on investments ........................ 997,668 ------------ Net increase in net assets resulting from operations ............................... $ 9,509,205 ============
See accompanying notes to financial statements. TAX-FREE FUND FOR UTAH STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED YEAR ENDED JUNE 30, 2007 JUNE 30, 2006 ------------- ------------- OPERATIONS: Net investment income ....................................................... $ 8,511,537 $ 7,660,792 Net realized gain (loss) from securities transactions ....................... 686,688 349,428 Change in unrealized depreciation on investments ............................ 310,980 (7,697,675) ------------- ------------- Change in net assets from operations ...................................... 9,509,205 312,545 ------------- ------------- DISTRIBUTIONS TO SHAREHOLDERS (note 10): Class A Shares: Net investment income ....................................................... (5,969,997) (5,675,675) Class C Shares: Net investment income ....................................................... (1,072,516) (1,052,465) Class Y Shares: Net investment income ....................................................... (1,896,685) (1,389,390) ------------- ------------- Change in net assets from distributions ................................... (8,939,198) (8,117,530) ------------- ------------- CAPITAL SHARE TRANSACTIONS (note 7): Proceeds from shares sold ................................................... 55,169,672 90,295,939 Reinvested dividends and distributions ...................................... 5,565,179 5,246,203 Cost of shares redeemed ..................................................... (50,191,077) (43,527,443) ------------- ------------- Change in net assets from capital share transactions ...................... 10,543,774 52,014,699 ------------- ------------- Change in net assets ...................................................... 11,113,781 44,209,714 NET ASSETS: Beginning of period ........................................................... 215,809,345 171,599,631 ------------- ------------- End of period* ................................................................ $ 226,923,126 $ 215,809,345 ============= ============= * Includes undistributed net investment income and distributions in excess of net investment income, respectively, of: $ 34,778 $ (119,601) ============= =============
See accompanying notes to financial statements. TAX-FREE FUND FOR UTAH NOTES TO FINANCIAL STATEMENTS JUNE 30, 2007 1. ORGANIZATION Tax-Free Fund For Utah (the "Fund"), a non-diversified, open-end investment company, was organized on December 12, 1990 as a Massachusetts business trust and commenced operations on July 24, 1992. The Fund is authorized to issue an unlimited number of shares and, since its inception to May 21, 1996, offered only one class of shares. On that date, the Fund began offering two additional classes of shares, Class C and Class Y Shares. All shares outstanding prior to that date were designated as Class A Shares and are sold with a front-payment sales charge and bear an annual distribution fee. Class C Shares are sold with a level-payment sales charge with no payment at time of purchase but level service and distribution fees from date of purchase through a period of six years thereafter. A contingent deferred sales charge of 1% is assessed to any Class C shareholder who redeems shares of this Class within one year from the date of purchase. Class C Shares, together with a pro-rata portion of all Class C Shares acquired through reinvestment of dividends and other distributions paid in additional Class C Shares, automatically convert to Class A Shares after 6 years. The Class Y Shares are only offered to institutions acting for an investor in a fiduciary, advisory, agency, custodian or similar capacity and are not offered directly to retail investors. Class Y Shares are sold at net asset value without any sales charge, redemption fees, contingent deferred sales charge or distribution or service fees. On October 31, 1997, the Fund established Class I Shares which are offered and sold only through financial intermediaries and are not offered directly to retail investors. As of the report date, there were no Class I Shares outstanding. All classes of shares represent interests in the same portfolio of investments and are identical as to rights and privileges but differ with respect to the effect of sales charges, the distribution and/or service fees borne by each class, expenses specific to each class, voting rights on matters affecting a single class and the exchange privileges of each class. 2. SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America for investment companies. a) PORTFOLIO VALUATION: Municipal securities which have remaining maturities of more than 60 days are valued each business day based upon information provided by a nationally prominent independent pricing service and periodically verified through other pricing services. In the case of securities for which market quotations are readily available, securities are valued by the pricing service at the mean of bid and asked quotations. If market quotations or a valuation from the pricing service is not readily available, the security is valued at fair value determined in good faith under procedures established by and under the general supervision of the Board of Trustees. Securities which mature in 60 days or less are valued at amortized cost if their term to maturity at purchase is 60 days or less, or by amortizing their unrealized appreciation or depreciation on the 61st day prior to maturity, if their term to maturity at purchase exceeds 60 days. b) SECURITIES TRANSACTIONS AND RELATED INVESTMENT INCOME: Securities transactions are recorded on the trade date. Realized gains and losses from securities transactions are reported on the identified cost basis. Interest income is recorded daily on the accrual basis and is adjusted for amortization of premium and accretion of original issue and market discount. c) FEDERAL INCOME TAXES: It is the policy of the Fund to qualify as a regulated investment company by complying with the provisions of the Internal Revenue Code applicable to certain investment companies. The Fund intends to make distributions of income and securities profits sufficient to relieve it from all, or substantially all, Federal income and excise taxes. d) MULTIPLE CLASS ALLOCATIONS: All income, expenses (other than class-specific expenses), and realized and unrealized gains or losses are allocated daily to each class of shares based on the relative net assets of each class. Class-specific expenses, which include distribution and service fees and any other items that are specifically attributed to a particular class, are charged directly to such class. e) USE OF ESTIMATES: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. f) ACCOUNTING PRONOUNCEMENTS: In July 2006, the Financial Accounting Standards Board ("FASB") released FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is required to be implemented no later than December 31, 2007 and is to be applied to all open tax years as of that date. At this time, management does not believe the adoption of FIN 48 will result in any material impact on the Fund's financial statements. In September 2006, FASB issued FASB Statement No. 157, "Fair Value Measurement" ("SFAS 157"), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. SFAS 157 is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Fund believes adoption of SFAS 157 will have no material impact on the Fund's financial statements. 3. FEES AND RELATED PARTY TRANSACTIONS a) MANAGEMENT ARRANGEMENTS: Aquila Investment Management LLC (the "Manager"), a wholly-owned subsidiary of Aquila Management Corporation, the Fund's founder and sponsor, serves as the Manager for the Fund under an Advisory and Administration Agreement with the Fund. Under the Advisory and Administration Agreement, the Manager provides all investment management and administrative services to the Fund. The Manager's services include providing the office of the Fund and all related services as well as managing relationships with all the various support organizations to the Fund such as the shareholder servicing agent, custodian, legal counsel, fund accounting agent, auditors and distributor. For its services, the Manager is entitled to receive a fee which is payable monthly and computed as of the close of business each day at the annual rate of 0.50 of 1% on the Fund's average net assets. For the year ended June 30, 2007, the Fund incurred management fees of $1,110,710 of which $666,428 was waived. The Manager has contractually undertaken to waive fees and/or reimburse Fund expenses during the period July 1, 2006 through June 30, 2007 so that total Fund expenses would not exceed 0.85% for Class A Shares, 1.65% for Class C Shares or 0.65% for Class Y Shares. Under a Compliance Agreement with the Manager, the Manager is compensated for Chief Compliance Officer related services provided to enable the Fund to comply with Rule 38a-1 of the Investment Company Act of 1940. Specific details as to the nature and extent of the services provided by the Manager are more fully defined in the Fund's Prospectus and Statement of Additional Information. b) DISTRIBUTION AND SERVICE FEES: The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 (the "Rule") under the Investment Company Act of 1940, as amended. Under one part of the Plan, with respect to Class A Shares, the Fund is authorized to make distribution fee payments to broker-dealers or others ("Qualified Recipients") selected by Aquila Distributors, Inc. (the "Distributor") including, but not limited to, any principal underwriter of the Fund, with which the Distributor has entered into written agreements contemplated by the Rule and which have rendered assistance in the distribution and/or retention of the Fund's shares or servicing of shareholder accounts. The Fund makes payment of this service fee at the annual rate of 0.20% of the Fund's average net assets represented by Class A Shares. For the year ended June 30, 2007, distribution fees on Class A Shares amounted to $291,171, of which the Distributor retained $5,476. Under another part of the Plan, the Fund is authorized to make payments with respect to Class C Shares to Qualified Recipients which have rendered assistance in the distribution and/or retention of the Fund's Class C shares or servicing of shareholder accounts. These payments are made at the annual rate of 0.75% of the Fund's average net assets represented by Class C Shares and for the year ended June 30, 2007, amounted to $243,267. In addition, under a Shareholder Services Plan, the Fund is authorized to make service fee payments with respect to Class C Shares to Qualified Recipients for providing personal services and/or maintenance of shareholder accounts. These payments are made at the annual rate of 0.25% of the Fund's average net assets represented by Class C Shares and for the year ended June 30, 2007 amounted to $81,089. The total of these payments with respect to Class C Shares amounted to $324,356, of which the Distributor retained $64,436. Specific details about the Plans are more fully defined in the Fund's Prospectus and Statement of Additional Information. Under a Distribution Agreement, the Distributor serves as the exclusive distributor of the Fund's shares. Through agreements between the Distributor and various broker-dealer firms ("dealers"), the Fund's shares are sold primarily through the facilities of these dealers having offices within Utah, with the bulk of sales commissions inuring to such dealers. For the year ended June 30, 2007, total commissions on sales of Class A Shares amounted to $446,181, of which the Distributor received $36,972. c) OTHER RELATED PARTY TRANSACTIONS: For the year ended June 30, 2007, the Fund incurred $84,683 of legal fees allocable to Hollyer Brady Barrett & Hines LLP ("Hollyer Brady") and its successor, Butzel Long PC, counsel to the Fund, for legal services in conjunction with the Fund's ongoing operations. The Secretary of the Fund was a partner at Hollyer Brady and is a shareholder of its successor. 4. PURCHASES AND SALES OF SECURITIES During the year ended June 30, 2007, purchases of securities and proceeds from the sales of securities aggregated $52,280,717 and $38,384,278, respectively. At June 30, 2007, the aggregate tax cost for all securities was $226,799,052. At June 30, 2007, the aggregate gross unrealized appreciation for all securities in which there is an excess of value over tax cost amounted to $1,686,777 and aggregate gross unrealized depreciation for all securities in which there is an excess of tax cost over value amounted to $2,700,856, for a net unrealized depreciation of $1,014,079. 5. PORTFOLIO ORIENTATION Since the Fund may invest entirely in double tax-free municipal obligations of issuers within Utah, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Utah and whatever effects these may have upon Utah issuers' ability to meet their obligations. The Fund is also permitted to invest in tax-free municipal obligations meeting comparable quality standards of issuers in certain states that do not tax the interest on obligations of Utah issuers and that provide income which is exempt from both regular Federal and Utah income taxes. At June 30, 2007, the Fund had 63% of its net assets invested in State of Utah municipal issues. 6. EXPENSES The Fund has negotiated an expense offset arrangement with its custodian wherein it receives credit toward the reduction of custodian fees and other Fund expenses whenever there are uninvested cash balances. The Statement of Operations reflects the total expenses before any offset, the amount of offset and the net expenses. 7. CAPITAL SHARE TRANSACTIONS Transactions in Capital Shares of the Fund were as follows:
YEAR ENDED YEAR ENDED JUNE 30, 2007 JUNE 30, 2006 ------------------------------ ------------------------------ SHARES AMOUNT SHARES AMOUNT --------- ------------ --------- ------------ CLASS A SHARES: Proceeds from shares sold .............. 2,804,057 $ 28,292,959 3,497,622 $ 35,254,242 Reinvested distributions ............... 385,904 3,893,635 369,013 3,717,136 Cost of shares redeemed ................ (2,569,962) (25,914,165) (1,747,696) (17,557,375) --------- ------------ --------- ------------ Net change ..................... 619,999 6,272,429 2,118,939 21,414,003 --------- ------------ --------- ------------ CLASS C SHARES: Proceeds from shares sold .............. 758,270 7,658,338 1,195,649 12,049,190 Reinvested distributions ............... 62,950 634,919 63,534 639,693 Cost of shares redeemed ................ (1,125,043) (11,352,553) (524,023) (5,274,452) --------- ------------ --------- ------------ Net change ..................... (303,823) (3,059,296) 735,160 7,414,431 --------- ------------ --------- ------------ CLASS Y SHARES: Proceeds from shares sold .............. 1,898,552 19,218,375 4,237,512 42,992,507 Reinvested distributions ............... 102,317 1,036,625 88,225 889,374 Cost of shares redeemed ................ (1,277,759) (12,924,359) (2,049,983) (20,695,616) --------- ------------ --------- ------------ Net change ..................... 723,110 7,330,641 2,275,754 23,186,265 --------- ------------ --------- ------------ Total transactions in Fund shares ................................. 1,039,286 $ 10,543,774 5,129,853 $ 52,014,699 ========= ============ ========= ============
8. TRUSTEES' FEES AND EXPENSES At June 30, 2007 there were 7 Trustees, one of which is affiliated with the Manager and is not paid any fees. The total amount of Trustees' service and attendance fees paid during the year ended June 30, 2007 was $72,625, to cover carrying out their responsibilities and attendance at regularly scheduled quarterly Board Meetings and meetings of the Independent Trustees held prior to each quarterly Board Meeting. When additional or special meetings are held, the meeting fees are paid to those Trustees in attendance. Trustees are reimbursed for their expenses such as travel, accommodations, and meals incurred in connection with attendance at Board Meetings and the Annual Meeting of Shareholders. For the year ended June 30, 2007, such meeting-related expenses amounted to $15,247. 9. SECURITIES TRADED ON A WHEN-ISSUED BASIS The Fund may purchase or sell securities on a when-issued basis. When-issued transactions arise when securities are purchased or sold by the Fund with payment and delivery taking place in the future in order to secure what is considered to be an advantageous price and yield to the Fund at the time of entering into the transaction. Beginning on the date the Fund enters into a when-issued transaction, cash or other liquid securities are segregated in an amount equal to or greater than the amount of the when-issued transaction. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities. 10. INCOME TAX INFORMATION AND DISTRIBUTIONS The Fund declares dividends daily from net investment income and makes payments monthly in additional shares at the net asset value per share, in cash, or in a combination of both, at the shareholder's option. Net realized capital gains, if any, are distributed annually and are taxable. The Fund intends to maintain, to the maximum extent possible, the tax-exempt status of interest payments received from portfolio municipal securities in order to allow dividends paid to shareholders from net investment income to be exempt from regular Federal and State of Utah income taxes. However, due to differences between financial statement reporting and Federal income tax reporting requirements, distributions made by the Fund may not be the same as the Fund's net investment income, and/or net realized securities gains. In this regard, the Fund credited distributions in excess of net investment income in the amount of $582,040 and debited additional paid-in capital in the amount of $582,040 at June 30, 2007. This adjustment had no impact on the Fund's aggregate net assets at June 30, 2007. Further, a small portion of the dividends may, under some circumstances, be subject to taxes at ordinary income rates. For certain shareholders some dividend income may, under some circumstances, be subject to the alternative minimum tax. At June 30, 2007, the Fund had a capital loss carryover of $1,704,433 of which $1,435,148 expires on June 30, 2009, $15,469 expires on June 30, 2011, and $253,816 expires on June 30, 2012. This carryover is available to offset future net realized gains on securities transactions to the extent provided for in the Internal Revenue Code. To the extent that this loss is used to offset future realized capital gains, it is probable that the gains so offset will not be distributed. The tax character of distributions: YEAR ENDED JUNE 30, 2007 2006 ----------- ----------- Net tax-exempt income $ 8,484,772 $ 7,658,064 Ordinary income 454,426 459,466 ----------- ----------- $ 8,939,198 $ 8,117,530 =========== =========== As of June 30, 2007, the components of distributable earnings on a tax basis were as follows: Undistributed tax-exempt income $ 175,158 Accumulated net realized loss (1,704,433) Unrealized depreciation (1,014,079) Other temporary differences (175,158) ----------- $(2,718,512) =========== At June 30, 2007, the difference between book basis and tax basis unrealized appreciation was attributable primarily to the treatment of accretion of discounts and amortization of premiums. 11. RECENT DEVELOPMENTS In late May, 2007, the U. S. Supreme Court agreed to hear an appeal in DEPARTMENT OF REVENUE OF KENTUCKY V. DAVIS, a case concerning the constitutionality of differential tax treatment for interest from in-state vs. out-of-state municipal securities, a practice which is common among the majority of the states. If the U.S. Supreme Court affirms the prior decision, Kentucky (and all other states that differentially tax interest on municipal bonds) may then be required to accord equal income tax treatment to all municipal bond interest. While it is impossible to predict the consequences of such an outcome, they may include effects on the net asset values of the shares, and/or on the tax treatment of the dividends, of some or all single-state municipal bond funds, including the Fund. The case is expected to be heard and decided during the U.S. Supreme Court's October 2007 - April 2008 term, with a decision likely to be handed down in 2008. TAX-FREE FUND FOR UTAH FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
Class A ----------------------------------------------------------------- Year Ended June 30, ----------------------------------------------------------------- 2007 2006 2005 2004 2003 -------- -------- -------- -------- -------- Net asset value, beginning of period ......................... $ 9.87 $ 10.26 $ 9.91 $ 10.31 $ 9.85 -------- -------- -------- -------- -------- Income (loss) from investment operations: Net investment income .................................. 0.40+ 0.40+ 0.41+ 0.43++ 0.44+ Net gain (loss) on securities (both realized and unrealized) ................................... 0.05 (0.37) 0.38 (0.37) 0.48 -------- -------- -------- -------- -------- Total from investment operations ....................... 0.45 0.03 0.79 0.06 0.92 -------- -------- -------- -------- -------- Less distributions (note 10): Dividends from net investment income ................... (0.41) (0.42) (0.44) (0.46) (0.46) Distributions from capital gains ....................... -- -- -- -- -- -------- -------- -------- -------- -------- Total distributions .................................... (0.41) (0.42) (0.44) (0.46) (0.46) -------- -------- -------- -------- -------- Net asset value, end of period ............................... $ 9.91 $ 9.87 $ 10.26 $ 9.91 $ 10.31 ======== ======== ======== ======== ======== Total return (not reflecting sales charge) ................... 4.60% 0.28% 8.06% 0.54% 9.55% Ratios/supplemental data Net assets, end of period (in thousands) ............... $148,894 $142,227 $126,091 $ 94,103 $ 85,329 Ratio of expenses to average net assets ................ 0.68% 0.64% 0.59% 0.48% 0.43% Ratio of net investment income to average net assets ........................................ 3.89% 3.90% 3.98% 4.19% 4.31% Portfolio turnover rate ................................ 17.36% 9.61% 8.68% 15.98% 6.43% The expense and net investment income ratios without the effect of the waiver of a portion of the management fee and the expense reimbursement were (note 3): Ratio of expenses to average net assets ................ 0.96% 0.93% 0.97% 0.94% 1.02% Ratio of net investment income to average net assets ........................................ 3.61% 3.61% 3.60% 3.73% 3.72% The expense ratios after giving effect to the waiver, reimbursement and expense offset for uninvested cash balances were (note 3): Ratio of expenses to average net assets ................ 0.66% 0.61% 0.56% 0.47% 0.42%
- ---------- + Per share amounts have been calculated using the monthly average shares method. ++ Per share amount calculated using the daily average shares method. See accompanying notes to financial statements. TAX-FREE FUND FOR UTAH FINANCIAL HIGHLIGHTS (CONTINUED) FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
Class C ----------------------------------------------------------------- Year Ended June 30, ----------------------------------------------------------------- 2007 2006 2005 2004 2003 -------- -------- -------- -------- -------- Net asset value, beginning of period ......................... $ 9.87 $ 10.26 $ 9.91 $ 10.30 $ 9.85 -------- -------- -------- -------- -------- Income (loss) from investment operations: Net investment income .................................. 0.32+ 0.32+ 0.32+ 0.34++ 0.34+ Net gain (loss) on securities (both realized and unrealized) .......................... 0.05 (0.37) 0.38 (0.36) 0.48 -------- -------- -------- -------- -------- Total from investment operations ............................. 0.37 (0.05) 0.70 (0.02) 0.82 -------- -------- -------- -------- -------- Less distributions (note 10): Dividends from net investment income ................... (0.33) (0.34) (0.35) (0.37) (0.37) Distributions from capital gains ....................... -- -- -- -- -- -------- -------- -------- -------- -------- Total distributions .................................... (0.33) (0.34) (0.35) (0.37) (0.37) -------- -------- -------- -------- -------- Net asset value, end of period ............................... $ 9.91 $ 9.87 $ 10.26 $ 9.91 $ 10.30 ======== ======== ======== ======== ======== Total return (not reflecting sales charge) ................... 3.77% (0.52)% 7.20% (0.16)% 8.48% Ratios/supplemental data Net assets, end of period (in thousands) ............... $ 30,905 $ 33,791 $ 27,581 $ 21,961 $ 16,420 Ratio of expenses to average net assets ................ 1.48% 1.44% 1.39% 1.27% 1.31% Ratio of net investment income to average net assets ................................ 3.10% 3.10% 3.18% 3.38% 3.39% Portfolio turnover rate ................................ 17.36% 9.61% 8.68% 15.98% 6.43% The expense and net investment income ratios without the effect of the waiver of a portion of the management fee and the expense reimbursement were (note 3): Ratio of expenses to average net assets ................ 1.76% 1.72% 1.77% 1.74% 1.81% Ratio of net investment income to average net assets ................................ 2.81% 2.81% 2.80% 2.93% 2.89% The expense ratios after giving effect to the waiver, reimbursement and expense offset for uninvested cash balances were (note 3): Ratio of expenses to average net assets ................ 1.46% 1.41% 1.36% 1.27% 1.30% Class Y ----------------------------------------------------------------- Year Ended June 30, ----------------------------------------------------------------- 2007 2006 2005 2004 2003 -------- -------- -------- -------- -------- Net asset value, beginning of period ......................... $ 9.90 $ 10.29 $ 9.94 $ 10.34 $ 9.89 -------- -------- -------- -------- -------- Income (loss) from investment operations: Net investment income .................................. 0.41+ 0.42+ 0.42+ 0.44++ 0.42+ Net gain (loss) on securities (both realized and unrealized) .......................... 0.07 (0.37) 0.39 (0.36) 0.50 -------- -------- -------- -------- -------- Total from investment operations ............................. 0.48 0.05 0.81 0.08 0.92 -------- -------- -------- -------- -------- Less distributions (note 10): Dividends from net investment income ................... (0.44) (0.44) (0.46) (0.48) (0.47) Distributions from capital gains ....................... -- -- -- -- -- -------- -------- -------- -------- -------- Total distributions .................................... (0.44) (0.44) (0.46) (0.48) (0.47) -------- -------- -------- -------- -------- Net asset value, end of period ............................... $ 9.94 $ 9.90 $ 10.29 $ 9.94 $ 10.34 ======== ======== ======== ======== ======== Total return (not reflecting sales charge) ................... 4.80% 0.49% 8.27% 0.76% 9.55% Ratios/supplemental data Net assets, end of period (in thousands) ............... $ 47,124 $ 39,791 $ 17,928 $ 8,233 $ 883 Ratio of expenses to average net assets ................ 0.48% 0.44% 0.39% 0.28% 0.30% Ratio of net investment income to average net assets ................................ 4.09% 4.10% 4.15% 4.41% 4.17% Portfolio turnover rate ................................ 17.36% 9.61% 8.68% 15.98% 6.43% The expense and net investment income ratios without the effect of the waiver of a portion of the management fee and the expense reimbursement were (note 3): Ratio of expenses to average net assets ................ 0.76% 0.72% 0.77% 0.74% 0.78% Ratio of net investment income to average net assets ................................ 3.81% 3.82% 3.78% 3.95% 3.70% The expense ratios after giving effect to the waiver, reimbursement and expense offset for uninvested cash balances were (note 3): Ratio of expenses to average net assets ................ 0.46% 0.41% 0.37% 0.27% 0.29%
- ---------- + Per share amounts have been calculated using the monthly average shares method. ++ Per share amount calculated using the daily average shares method. See accompanying notes to financial statements.
NUMBER OF POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS HELD WITH IN FUND HELD BY TRUSTEE NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.) - ----------------- ---------- ------------------- ---------- --------------------- INTERESTED TRUSTEES(4) Diana P. Herrmann Trustee since 1997 Vice Chair and Chief Executive Officer 12 ICI Mutual Insurance Company New York, NY and President of Aquila Management Corporation, (02/25/58) since 1998 Founder of the Aquila Group of Funds(SM)(5) and parent of Aquila Investment Management LLC, Manager since 2004, President and Chief Operating Officer since 1997, a Director since 1984, Secretary since 1986 and previously its Executive Vice President, Lacy B. Herrmann Founder and Chairman Founder and Chairman of the Board, 1986-1997; Chief Executive Officer and Vice Chair since 2004 and President, Chief Operating Officer and Manager of the Manager since 2003; Chair, Vice Chair, President, Executive Vice President or Senior Vice President of funds in the Aquila Group of Funds(SM) since 1986; Director of the Distributor since 1997; trustee, Reserve Money-Market Funds, 1999-2000 and Reserve Private Equity Series, 1998-2000; Governor, Investment Company Institute and head of its Small Funds Committee since 2004; active in charitable and volunteer organizations. NON-INTERESTED TRUSTEES Gary C. Cornia Chair of the Board Director, Romney Institute of Public 4 None Orem, UT of Trustees since Management, Marriott School of (06/24/48) 2005 and Trustee Management, Brigham Young University, since 1993 2004 - present; Professor, Marriott School of Management, 1980 - present; Past President, the National Tax Association; Fellow, Lincoln Institute of Land Policy, 2002 - present; Associate Dean, Marriott School of Management, Brigham Young University, 1991-2000; Utah Governor's Tax Review Committee since 1993.
NUMBER OF POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS HELD WITH IN FUND HELD BY TRUSTEE NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.) - ----------------- ---------- ------------------- ---------- --------------------- Anne J. Mills Vice Chair of the President, Loring Consulting Company 4 None Castle Rock, CO Bord since 2006 and since 2001; Vice President for Business (12/23/38) Trustee since 1994 Management and CFO, Ottawa University, since 2006, Vice President for Business Affairs, 1992-2001; IBM Corporation, 1965-1991; currently active with various charitable educational and religious organizations. Tucker Hart Adams Trustee President, The Adams Group, Inc., an 3 Director, Colorado Health Colorado Springs, CO since 2006 economic consulting firm, since 1989; Facilities Authority (01/11/38) formerly Chief Economist, United Banks of Colorado; currently or formerly active with numerous professional and community organizations. Thomas A. Christopher Trustee Vice President of Robinson, Hughes & 3 None Danville, KY since 2006 Christopher, C.P.A.s, P.S.C., since (12/19/47) 1977; President, A Good Place for Fun, Inc., a sports facility, since 1987; currently or formerly active with various professional and community organizations. Lyle W. Hillyard Trustee President of the law firm of Hillyard, 2 None Logan, UT since 2003 Anderson & Olsen, Logan, Utah, since (09/25/40) 1967; member of Utah Senate, 1985 to present, in the following positions: President, 2000, Senate Majority Leader, 1999-2000, Assistant Majority Whip, 1995-1998; served as Chairman of the following Senate Committees: Tax and Revenue, Senate Judiciary Standing, Joint Executive Appropriations, and Senate Rules; currently serves as Co-Chair, Joint Executive Appropriations.
NUMBER OF POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS HELD WITH IN FUND HELD BY TRUSTEE NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.) - ----------------- ---------- ------------------- ---------- --------------------- John C. Lucking Trustee President, Econ-Linc, an economic 3 Director, Sanu Resources Phoenix, AZ since 2004 consulting firm, since 1995; formerly (05/20/43) Consulting Economist, Bank One Arizona and Chief Economist, Valley National Bank; member, Arizona's Joint Legislative Budget Committee Economic Advisory Panel and the Western Blue Chip Economic Forecast Panel; Board, Northern Arizona University Foundation since 1997; member, various historical, civic and economic associations. OTHER INDIVIDUALS CHAIRMAN EMERITUS(6) Lacy B. Herrmann Founder and Chairman Founder and Chairman of the Board, N/A N/A New York, NY Emeritus since 2005, Aquila Management Corporation, the (05/12/29) Chairman of the sponsoring organization and parent of Board of Trustees, the Manager or Administrator and/or 1992-2005 Adviser or Sub-Adviser to each fund of the Aquila Group of Funds(SM); Chairman of the Manager or Administrator and/or Adviser or Sub-Adviser to each since 2004; Founder and Chairman Emeritus of each fund in the Aquila Group of Funds(SM); previously Chairman and a Trustee of each fund in the Aquila Group of Funds(SM) since its establishment until 2004 or 2005; Director of the Distributor since 1981 and formerly Vice President or Secretary, 1981-1998; Trustee Emeritus, Brown University and the Hopkins School; active in university, school and charitable organizations. OFFICERS Charles E. Executive Vice Executive Vice President of all funds in N/A N/A Childs, III President since 2003 the Aquila Group of Funds(SM) and the New York, NY Manager and the Manager's parent since (04/01/57) 2003; formerly Senior Vice President, corporate development, Vice President, Assistant Vice President and Associate of the Manager's parent since 1987; Senior Vice President, Vice President or Assistant Vice President of the Aquila Money-Market Funds, 1988-2003.
NUMBER OF POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS HELD WITH IN FUND HELD BY TRUSTEE NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.) - ----------------- ---------- ------------------- ---------- --------------------- Jerry G. McGrew Senior Vice President President of the Distributor since 1998, N/A N/A New York, NY since 1997 Registered Principal since 1993, Senior (06/18/44) Vice President, 1997-1998 and Vice President, 1993-1997; Senior Vice President, Aquila Three Peaks High Income Fund, Aquila Rocky Mountain Equity Fund and five Aquila Municipal Bond Funds; Vice President, Churchill Cash Reserves Trust, 1995-2001. Kimball L. Young Senior Vice President Co-portfolio manager, Tax-Free Fund For N/A N/A Salt Lake City, UT since 1997 Utah since 2001; Co-founder, Lewis Young (08/07/46) Robertson & Burningham, Inc., a NASD licensed broker/dealer providing public finance services to Utah local governments, 1995-2001; Senior Vice President of two Aquila Bond Funds and Aquila Rocky Mountain Equity Fund; formerly Senior Vice President-Public Finance, Kemper Securities Inc., Salt Lake City, Utah. Thomas S. Albright Senior Vice Senior Vice President and Portfolio N/A N/A Louisville, KY President since 2003 Manager, Churchill Tax-Free Fund of (07/26/52) and Vice President, Kentucky since July 2000; Senior Vice 2001-2003 President, Tax-Free Fund For Utah since 2003, Vice President, 2001-2003 and co-portfolio manager since 2001; Vice President and backup portfolio manager, Tax-Free Trust of Arizona, since 2004; Vice President and Portfolio Manager, Banc One Investment Advisors, Inc., 1994-2000. Mary Kayleen Willis Vice President since Vice President, Tax-Free Fund For Utah N/A N/A Salt Lake City, UT 2003 and Assistant since September 2003, Assistant Vice (06/11/63) Vice President, President, 2002-2003; Vice President, 2002-2003 Aquila Rocky Mountain Equity Fund, since 2004. Robert W. Anderson Chief Compliance Chief Compliance Officer of the Fund and N/A N/A New York, NY Officer since 2004 each of the other funds in the Aquila (08/23/40) and Assistant Group of Funds(SM), the Manager and the Secretary since 2000 Distributor since 2004, Compliance Officer of the Manager or its predecessor and current parent 1998-2004; Assistant Secretary of the Aquila Group of Funds(SM) since 2000.
NUMBER OF POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS HELD WITH IN FUND HELD BY TRUSTEE NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.) - ----------------- ---------- ------------------- ---------- --------------------- Joseph P. DiMaggio Chief Financial Chief Financial Officer of the Aquila N/A N/A New York, NY Officer since 2003 Group of Funds(SM) since 2003 and (11/06/56) and Treasurer since Treasurer since 2000. 2000 Edward M. W. Hines Secretary since 1992 Partner and then shareholder of legal N/A N/A New York, NY counsel to the Trust/Fund, Hollyer Brady (12/16/39) Barrett & Hines LLP since 1989 and thereafter its successor, Butzel Long, since 2007; Secretary of the Aquila Group of Funds(SM). John M. Herndon Assistant Secretary Assistant Secretary of the Aquila Group N/A N/A New York, NY since 1995 of Funds(SM) since 1995 and Vice President (12/17/39) of the three Aquila Money-Market Funds since 1990; Vice President of the Manager or its predecessor and current parent since 1990. Lori A. Vindigni Assistant Treasurer Assistant Treasurer of the Aquila Group N/A N/A New York, NY since 2000 of Funds(SM) since 2000; Assistant Vice (11/02/66) President of the Manager or its predecessor and current parent since 1998; Fund Accountant for the Aquila Group of Funds(SM), 1995-1998.
- ---------- (1) The Fund's Statement of Additional Information includes additional information about the Trustees and is available, without charge, upon request by calling 800-437-1020 (toll-free). (2) The mailing address of each Trustee and officer is c/o Tax-Free Fund For Utah, 380 Madison Avenue, New York, NY 10017. (3) Each Trustee holds office until the next annual meeting of shareholders or until his or her successor is elected and qualifies. The term of office of each officer is one year. (4) Ms. Herrmann is an interested person of the Fund as an officer of the Fund, as a director, officer and shareholder of the Manager's corporate parent, as an officer and Manager of the Manager, and as a shareholder and director of the Distributor. Ms. Herrmann is the daughter of Lacy B. Herrmann, the Founder and Chairman Emeritus of the Fund. (5) In this material Pacific Capital Cash Assets Trust, Pacific Capital U.S. Government Securities Cash Assets Trust and Pacific Capital Tax-Free Cash Assets Trust, each of which is a money-market fund, are called the "Aquila Money-Market Funds"; Hawaiian Tax-Free Trust, Tax-Free Trust of Arizona, Tax-Free Trust of Oregon, Tax-Free Fund of Colorado, Churchill Tax-Free Fund of Kentucky, Narragansett Insured Tax-Free Income Fund and Tax-Free Fund For Utah, each of which is a tax-free municipal bond fund, are called the "Aquila Municipal Bond Funds"; Aquila Rocky Mountain Equity Fund is an equity fund; Aquila Three Peaks High Income Fund is a high income corporate bond fund; considered together, these 12 funds are called the "Aquila Group of Funds(SM)." (6) The Chairman Emeritus may attend Board meetings but has no voting power. - -------------------------------------------------------------------------------- ANALYSIS OF EXPENSES (UNAUDITED) As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end sales charges with respect to Class A shares or contingent deferred sales charges ("CDSC") with respect to Class C shares; and (2) ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other Fund expenses. The table below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The table below is based on an investment of $1,000 invested on January 1, 2007 and held for the six months ended June 30, 2007. ACTUAL EXPENSES This table provides information about actual account values and actual expenses. You may use the information provided in this table, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expenses you paid on your account, divide your ending account value by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled "Expenses Paid During the Period". SIX MONTHS ENDED JUNE 30, 2007 ACTUAL TOTAL RETURN BEGINNING ENDING EXPENSES WITHOUT ACCOUNT ACCOUNT PAID DURING SALES CHARGES(1) VALUE VALUE THE PERIOD(2) - -------------------------------------------------------------------------------- Class A (0.46)% $1,000.00 $995.40 $3.27 - -------------------------------------------------------------------------------- Class C (0.75)% $1,000.00 $992.50 $7.21 - -------------------------------------------------------------------------------- Class Y (0.35)% $1,000.00 $996.50 $2.28 - -------------------------------------------------------------------------------- (1) ASSUMES REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS, IF ANY, AT NET ASSET VALUE AND DOES NOT REFLECT THE DEDUCTION OF THE APPLICABLE SALES CHARGES WITH RESPECT TO CLASS A SHARES OR THE APPLICABLE CONTINGENT DEFERRED SALES CHARGES ("CDSC") WITH RESPECT TO CLASS C SHARES. TOTAL RETURN IS NOT ANNUALIZED, AS IT MAY NOT BE REPRESENTATIVE OF THE TOTAL RETURN FOR THE YEAR. (2) EXPENSES ARE EQUAL TO THE ANNUALIZED EXPENSE RATIO OF 0.66%, 1.46% AND 0.46% FOR THE FUND'S CLASS A, C AND Y SHARES, RESPECTIVELY, MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY 181/365 (TO REFLECT THE ONE-HALF YEAR PERIOD). - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ANALYSIS OF EXPENSES (UNAUDITED) (CONTINUED) HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES The table below provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio and an assumed rate of return of 5.00% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use the information provided in this table to compare the ongoing costs of investing in the Fund and other mutual funds. To do so, compare this 5.00% hypothetical example relating to the Fund with the 5.00% hypothetical examples that appear in the shareholder reports of other mutual funds. Please note that the expenses shown in the table below are meant to highlight your ongoing costs only and do not reflect any transactional costs with respect to Class A shares. The example does not reflect the deduction of contingent deferred sales charges ("CDSC") with respect to Class C shares. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different mutual funds. In addition, if these transaction costs were included, your costs would have been higher. SIX MONTHS ENDED JUNE 30, 2007 HYPOTHETICAL ANNUALIZED BEGINNING ENDING EXPENSES TOTAL ACCOUNT ACCOUNT PAID DURING RETURN VALUE VALUE THE PERIOD(1) - -------------------------------------------------------------------------------- Class A 5.00% $1,000.00 $1,021.52 $3.31 - -------------------------------------------------------------------------------- Class C 5.00% $1,000.00 $1,017.55 $7.30 - -------------------------------------------------------------------------------- Class Y 5.00% $1,000.00 $1,022.51 $2.31 - -------------------------------------------------------------------------------- (1) EXPENSES ARE EQUAL TO THE ANNUALIZED EXPENSE RATIO OF 0.66%, 1.46% AND 0.46% FOR THE FUND'S CLASS A, C AND Y SHARES, RESPECTIVELY, MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY 181/365 (TO REFLECT THE ONE-HALF YEAR PERIOD). - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- INFORMATION AVAILABLE (UNAUDITED) Much of the information that the funds in the Aquila Group of Funds(SM) produce is automatically sent to you and all other shareholders. Specifically, you are routinely sent the entire list of portfolio securities of your Fund twice a year in the semi-annual and annual reports you receive. Additionally, we prepare, and have available, portfolio listings at the end of each quarter. Whenever you may be interested in seeing a listing of your Fund's portfolio other than in your shareholder reports, please check our website http://www.aquilafunds.com or call us at 1-800-437-1020. The Fund additionally files a complete list of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available free of charge on the SEC website at http://www.sec.gov. You may also review or, for a fee, copy the forms at the SEC's Public Reference Room in Washington, DC or by calling 800-SEC-0330. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PROXY VOTING RECORD (UNAUDITED) The Fund does not invest in equity securities. Accordingly, there were no matters relating to a portfolio security considered at any shareholder meeting held during the 12 months ended June 30, 2007 with respect to which the Fund was entitled to vote. Applicable regulations require us to inform you that the foregoing proxy voting information is available on the SEC website at http://www.sec.gov. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- FEDERAL TAX STATUS OF DISTRIBUTIONS (UNAUDITED) This information is presented in order to comply with a requirement of the Internal Revenue Code AND NO ACTION ON THE PART OF SHAREHOLDERS IS REQUIRED. For the fiscal year ended June 30, 2007, $8,484,272 of dividends paid by Tax-Free Fund For Utah, constituting 94.92% of total dividends paid during the fiscal year ended June 30, 2007, were exempt-interest dividends, and the balance was ordinary dividend income. Prior to January 31, 2007, shareholders were mailed the appropriate tax form(s) which contained information on the status of distributions paid for the 2006 CALENDAR YEAR. Prior to January 31, 2008, shareholders will be mailed the appropriate tax form(s) which will contain information on the status of distributions paid for the 2007 CALENDAR YEAR. - -------------------------------------------------------------------------------- SHAREHOLDER MEETING RESULTS (UNAUDITED) The Annual Meeting of Shareholders of Tax-Free Fund For Utah was held on June 22, 2007. The holders of shares representing 80% of the total net asset value of the shares entitled to vote were present in person or by proxy. At the meeting, the following matter was voted upon and approved by the shareholders (the resulting votes are presented below). 1. To elect Trustees DOLLAR AMOUNT OF VOTES ---------------------- TRUSTEE FOR WITHHELD ------- --- -------- Tucker Hart Adams $181,840,032 $ 873,566 Thomas A. Christopher $181,278,540 $1,435,049 Gary C. Cornia $181,931,137 $ 782,462 Diana P. Herrmann $182,496,256 $ 217,342 Lyle W. Hillyard $181,214,349 $1,499,240 John C. Lucking $181,923,791 $ 789,797 Anne J. Mills $182,415,881 $ 310,611 - -------------------------------------------------------------------------------- PRIVACY NOTICE (UNAUDITED) TAX-FREE FUND FOR UTAH OUR PRIVACY POLICY. In providing services to you as an individual who owns or is considering investing in shares of the Fund, we collect certain non-public personal information about you. Our policy is to keep this information strictly safeguarded and confidential, and to use or disclose it only as necessary to provide services to you or as otherwise permitted by law. Our privacy policy applies equally to former shareholders and persons who inquire about the Fund. INFORMATION WE COLLECT. "Non-public personal information" is personally identifiable financial information about you as an individual or your family. The kinds of non-public personal information we have about you may include the information you provide us on your share purchase application or in telephone calls or correspondence with us, and information about your fund transactions and holdings, how you voted your shares and the account where your shares are held. INFORMATION WE DISCLOSE. We disclose non-public personal information about you to companies that provide necessary services to us, such as the Fund's transfer agent, distributor, investment adviser or sub-adviser, as permitted or required by law, or as authorized by you. Any other use is strictly prohibited. We do not sell information about you or any of our fund shareholders to anyone. NON-CALIFORNIA RESIDENTS: We also may disclose some of this information to another fund in the Aquila Group of Funds(SM) (or its service providers) under joint marketing agreements that permit the funds to use the information only to provide you with information about other funds in the Aquila Group of Funds(SM) or new services we are offering that may be of interest to you. CALIFORNIA RESIDENTS ONLY: In addition, unless you "opt-out" of the following disclosures using the form that was mailed to you under separate cover, we may disclose some of this information to another fund in the Aquila Group of Funds(SM) (or its sevice providers) under joint marketing agreements that permit the funds to use the information only to provide you with information about other funds in the Aquila Group of Funds(SM) or new services we are offering that may be of interest to you. HOW WE SAFEGUARD YOUR INFORMATION. We restrict access to non-public personal information about you to only those persons who need it to provide services to you or who are permitted by law to receive it. We maintain physical, electronic and procedural safeguards to protect the confidentiality of all non-public personal information we have about you. If you have any questions regarding our Privacy Policy, please contact us at 1-800-437-1020. AQUILA DISTRIBUTORS, INC. AQUILA INVESTMENT MANAGEMENT LLC This Privacy Policy also has been adopted by Aquila Distributors, Inc. and Aquila Investment Management LLC and applies to all non-public information about you that each of these companies may obtain in connection with services provided to the Fund or to you as a shareholder of the Fund. - -------------------------------------------------------------------------------- Founders Lacy B. Herrmann, Chairman Emeritus Aquila Management Corporation Manager AQUILA INVESTMENT MANAGEMENT LLC 380 Madison Avenue, Suite 2300 New York, New York 10017 BOARD OF TRUSTEES Gary C. Cornia, Chair Anne J. Mills, Vice Chair Tucker Hart Adams Thomas A. Christopher Diana P. Herrmann Lyle W. Hillyard John C. Lucking OFFICERS Diana P. Herrmann, President Jerry G. Mcgrew, Senior Vice President Kimball L. Young, Senior Vice President and Co-portfolio Manager Thomas S. Albright, Senior Vice President and Co-portfolio Manager M. Kayleen Willis, Vice President Robert W. Anderson, Chief Compliance Officer Joseph P. Dimaggio, Chief Financial Officer and Treasurer Edward M.w. Hines, Secretary DISTRIBUTOR AQUILA DISTRIBUTORS, INC. 380 Madison Avenue, Suite 2300 New York, New York 10017 TRANSFER AND SHAREHOLDER SERVICING AGENT PFPC INC. 101 Sabin Street Pawtucket, Ri 02860 CUSTODIAN JPMORGAN CHASE BANK, N.A. 1111 Polaris Parkway Columbus, Ohio 43240 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM TAIT, WELLER & BAKER LLP 1818 Market Street, Suite 2400 Philadelphia, Pa 19103 Further information is contained in the prospectus, which must precede or accompany this report. ITEM 2. CODE OF ETHICS. (a) As of June 30, 2007 (the end of the reporting period) the Trust has adopted a code of ethics that applies to the Trust's principal executive officer(s)and principal financial officer(s) and persons performing similar functions ("Covered Officers") as defined in the Aquila Group of Funds Code of Ethics for Principal Executive and Senior Financial Officers under Section 406 of the Sarbanes-Oxley Act of 2002; (f)(1) Pursuant to Item 10(a)(1), a copy of the Trust's Code of Ethics that applies to the Trust's principal executive officer(s) and principal financial officer(s) and persons performing similar functions is included as an exhibit to its annual report on this Form N-CSR; (f)(2) The text of the Trust's Code of Ethics that applies to the Trust's principal executive officer(s) and principal financial officer(s) and persons performing similar functions has been posted on its Internet website which can be found at the Trust's Internet address at aquilafunds.com. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. (a)(1)(ii) The Board of Trustees of the Fund has determined that it does not have at least one audit committee financial expert serving on its audit committee. The Fund does not have such a person serving on the audit committee because none of the persons currently serving as Trustees happens to have the technical accounting and auditing expertise included in the definition of "audit committee financial expert" recently adopted by the Securities and Exchange Commission in connection with this Form N-CSR, and the Board has not heretofore deemed it necessary to seek such a person for election to the Board. The primary mission of the Board, which is that of oversight over the operations and affairs of the Fund, confronts the Trustees with a wide and expanding range of issues and responsibilities. The Trustees believe that, accordingly, it is essential that the Board's membership consist of persons with as extensive experience as possible in fulfilling the duties and responsibilities of mutual fund directors and audit committee members and, ideally, with extensive experience and background relating to the economic and financial sectors and securities in which the Fund invests, including exposure to the financial and accounting matters commonly encountered with respect to those sectors and securities. The Board believes that its current membership satisfies those criteria. It recognizes that it would also be helpful to have a member with the relatively focused accounting and auditing expertise reflected in the applicable definition of "audit committee financial expert," just as additional members with similarly focused technical expertise in other areas relevant to the Fund's operations and affairs would also contribute added value. However, the Board believes that the Fund is better served, and its assets better employed, by a policy of hiring experts in various the specialized area of technical accounting and auditing matters, if and as the Board identifies the need, rather than by seeking to expand its numbers by adding technical experts in the areas constituting its domain of responsibility. The Fund's Audit Committee Charter explicitly authorizes the Committee to retain such experts as it deems necessary in fulfilling its duties under the Charter. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. a) Audit Fees - The aggregate fees billed for professional services rendered by the principal accountant for the audit of the Registrant's annual financial statements were $16,000 in 2007 and $16,000 in 2006. b) Audit Related Fees - There were no amounts billed for audit-related fees over the past two years. c) Tax Fees - The Registrant was billed by the principal accountant $3,000 and $3,000 in 2007 and 2006, respectively, for return preparation and tax compliance. d) All Other Fees - There were no additional fees paid for audit and non-audit services other than those disclosed in a) thorough c) above. e)(1) Currently, the audit committee of the Registrant pre-approves audit services and fees on an engagement-by-engagement basis e)(2) None of the services described in b) through d) above were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X, all were pre-approved on an engagement-by-engagement basis. f) No applicable. g) There were no non-audit services fees billed by the Registrant's accountant to the Registrant's investment adviser or distributor over the past two years h) Not applicable. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS. Included in Item 1 above ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The Board of Directors of the Registrant has adopted a Nominating Committee Charter which provides that the Nominating Committee (the 'Committee') may consider and evaluate nominee candidates properly submitted by shareholders if a vacancy among the Independent Trustees of the Registrant occurs and if, based on the Board's then current size, composition and structure, the Committee determines that the vacancy should be filled. The Committee will consider candidates submitted by shareholders on the same basis as it considers and evaluates candidates recommended by other sources. A copy of the qualifications and procedures that must be met or followed by shareholders to properly submit a nominee candidate to the Committee may be obtained by submitting a request in writing to the Secretary of the Registrant. ITEM 11. CONTROLS AND PROCEDURES. (a) Based on their evaluation of the registrant's disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) as of a date within 90 days of the filing of this report, the registrant's chief financial and executive officers have concluded that the disclosure controls and procedures of the registrant are appropriately designed to ensure that information required to be disclosed in the registrant's reports that are filed under the Securities Exchange Act of 1934 are accumulated and communicated to registrant's management, including its principal executive officer(s) and principal financial officer(s), to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the Securities and Exchange Commission. (b) There have been no significant changes in registrant's internal controls or in other factors that could significantly affect registrant's internal controls subsequent to the date of the most recent evaluation, including no significant deficiencies or material weaknesses that required corrective action. ITEM 12. EXHIBITS. (a)(1) Aquila Group of Funds Code of Ethics for Principal Executive and Senior Financial Officers under Section 406 of the Sarbanes-Oxley Act of 2002. (a)(2) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940. (b) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(b) under the Investment Company Act of 1940. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. TAX-FREE FUND FOR UTAH By: /s/ Diana P. Herrmann - - - --------------------------------- President and Trustee September 7, 2007 By: /s/ Joseph P. DiMaggio - - - ----------------------------------- Chief Financial Officer and Treasurer September 7, 2007 Pursuant to the requirements of the Securities Exchange Act of 1934 And the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Diana P. Herrmann - - - --------------------------------- Diana P. Herrmann President and Trustee September 7, 2007 By: /s/ Joseph P. DiMaggio - - - ----------------------------------- Joseph P. DiMaggio Chief Financial Officer and Treasurer September 7, 2007 TAX-FREE FUND FOR UTAH EXHIBIT INDEX (a)(1) Aquila Group of Funds Code of Ethics for Principal Executive and Senior Financial Officers under Section 406 of the Sarbanes-Oxley Act of 2002. (a) (2) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940. (b) Certification of chief executive officer and chief financial officer as required by Rule 30a-2(b) of the Investment Company Act of 1940. EX-99.CODE ETH 2 sarbanes.txt SARBANES-OXLEY CODE OF ETHICS AQUILA GROUP OF FUNDSsm CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS UNDER SECTION 406 OF THE SARBANES-OXLEY ACT OF 2002 I. Covered Officers/Purpose of the Code This is the code of ethics (the "Code") for the investment companies within the Aquilasm Group of Funds (collectively, "Funds" and each, a "Fund," each of which is detailed in Exhibit A). It applies to the Fund's Principal Executive Officer(s) and Principal Financial Officer(s) (the "Covered Officers," each of whom is listed in Exhibit B), for the purpose of promoting: *honest and ethical conduct, including the ethical handling of actual; *or apparent conflicts of interest between personal and professional relationships; *full, fair, accurate, timely and understandable disclosure in reports and documents that a registrant files with, or submits to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Fund; *compliance with applicable laws and governmental rules and regulations; *the prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and *accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. II. Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest Overview. A "conflict of interest" occurs when a Covered Officer's private interest interferes with the interests of, or his/her service to, the Fund. For example, a conflict of interest would arise if a Covered Officer, or a member of his/her family, receives improper personal benefits as a result of his/her position with the Fund. Certain conflicts of interest arise out of the relationships between Covered Officers and the Fund and already are subject to conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Fund because of their status as "affiliated persons" of the Fund. The Fund's and the investment adviser's compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code. Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between the Fund and the investment adviser of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Fund or for the adviser, or for both), be involved in establishing policies and implementing decisions that will have different effects on the adviser and the Fund. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Fund and the adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Fund. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Funds' Boards of Trustees ("Boards") that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes. Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the Fund. Each Covered Officer must: *not use his/her personal influence or personal relationships improperly to influence investment decisions or financial reporting by the Fund whereby the Covered Officer would benefit personally to the detriment of the Fund; *not cause the Fund to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit the Fund; There are some conflict of interest situations that should always be discussed with the general counsel of the Fund ("General Counsel"), if material. Examples of these include: *service as a director on the board of any public or private company; *the receipt of any non-nominal gifts; *the receipt of any entertainment from any company with which the Fund has current or prospective business dealings unless such entertainment is business- related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety; *any ownership interest in, or any consulting or employment relationship with, any of the Fund's service providers, other than its investment adviser, principal underwriter, administrator or any affiliated person thereof; *a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Fund for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership. III. Disclosure and Compliance Each Covered Officer should familiarize himself/herself with the disclosure requirements generally applicable to the Fund; *each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the Fund to others, whether within or outside the Fund, including to the Fund's Trustees and auditors, and to governmental regulators and self-regulatory organizations; each Covered Officer should, to the extent appropriate within his/her area of responsibility, consult with other officers and employees of the Funds and the adviser with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with, it is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. IV. Reporting and Accountability Each Covered Officer must: *upon adoption of the Code (or thereafter as applicable, upon becoming a Covered Officer), affirm in writing to the Board that he/she has received, read, and understands the Code; *annually thereafter affirm to the Board that he/she has complied with the requirements of the Code; *not retaliate against any other Covered Officer or any employee of the Funds or their affiliated persons for reports of potential violations that are made in good faith; and *notify the Chair of the Audit Committee of the Fund promptly if he/she knows of any violation of this Code. Failure to do so is itself a violation of this Code. *file at least annually a complete and accurate Funds' Trustees and Officers Questionnaire. The General Counsel is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. However, any approvals or waivers1 sought by the Chairman of the Board or the President will be considered by the Audit Committee (the "Committee"). The Funds will follow these procedures in investigating and enforcing this Code: *the General Counsel will take all appropriate action to investigate any potential violations reported to him; *if, after such investigation, the General Counsel believes that no violation has occurred, the General Counsel is not required to take any further action; any matter that the General Counsel believes is a violation will be reported to the Committee; * if the Committee concurs that a violation has occurred, it will inform the Board, which will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer; * the Committee will be responsible for granting waivers, as appropriate; and * any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules. V. Other Policies and Procedures This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. Insofar as othe policies or procedures of the Funds, the Funds' adviser, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code. The Funds' and their investment adviser's and principal underwriter's codes of ethics under Rule 17j-1 under the Investment Company Act and the adviser's more detailed policies and procedures set forth in their respective codes are separate requirements applying to the Covered Officers and others, and are not part of this Code. VI. Amendments Any amendments to this Code, other than amendments to Exhibit B, must be approved or ratified by a majority vote of the Board, including a majority of independent Trustees. VII. Confidentiality All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the appropriate Board and the General Counsel, and if deemed appropriate by the Board, with other Funds in the complex where the Funds share a common Covered Officer. VIII. Internal Use The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Fund, as to any fact, circumstance, or legal conclusion. Exhibit A Funds Covered by this Code of Ethics - ------------------------------------ Aquila Three Peaks High Income Fund Aquila Rocky Mountain Equity Fund Capital Cash Management Trust Cash Assets Trust series, consisting of Pacific Capital Cash Assets Trust Pacific Capital Tax-Free Cash Assets Trust Pacific Capital U.S. Government Cash Assets Trust Churchill Cash Reserves Trust Churchill Tax-Free Trust Hawaiian Tax-Free Trust Narragansett Insured Tax-Free Income Fund Tax-Free Fund For Utah Tax-Free Fund of Colorado Tax-Free Trust of Arizona Tax-Free Trust of Oregon Exhibit B Persons Covered by this Code of Ethics - -------------------------------------- The following officers of each Fund, and the identities of such officers as of June 30, 2007: Chairman and/or Chairman Emeritus And Founder Lacy B. Herrmann Chair, Vice Chair and/or Trustee and/or President Diana P. Herrmann Chief Financial Officer and Treasurer Joseph P. DiMaggio EX-99.CERT 3 tffu306cert.txt SECTION 306 CERTIFICATIONS CERTIFICATIONS I, Diana P. Herrmann, certify that: 1. I have reviewed this report on Form N-CSR of Tax-Free Fund For Utah; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) for the registrant and have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this report ("Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weakness in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: September 7, 2007 /s/ Diana P. Herrmann - - - ---------------------- Title: President and Trustee I, Joseph P. DiMaggio, certify that: 1. I have reviewed this report on Form N-CSR of Tax-Free Fund For Utah; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) for the registrant and have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this report ("Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weakness in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: September 7, 2007 /s/ Joseph P. DiMaggio - - - ------------------------ Title: Chief Financial Officer and Treasurer EX-99.906 CERT 4 tffu906cert.txt SECTION 906 CERTIFICATIONS CERTIFICATION Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18,United States Code), each of the undersigned officers of Tax-Free Fund For Utah, do hereby certify to such officer's knowledge, that: The report on Form N-CSR of Tax-Free Fund For Utah for the period ended June 30, 2007, (the "Form N-CSR") fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of Tax-Free Fund For Utah. Dated: Sepember 7, 2007 /s/ Diana P. Herrmann ------------------------- President and Trustee Tax-Free Fund For Utah Dated: September 7, 2007 `/s/ Joseph P. DiMaggio ------------------------- Chief Financial Officer and Treasurer Tax-Free Fund For Utah A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Tax-Free Fund For Utah and will be retained by Tax-Free Fund For Utah and furnished to the Securities and Exchange Commission or its staff upon request. This certification is being furnished solely pursuant to 18 U.S.C. ss. 1350 and is not being filed as part of the Report or as a separate disclosure document. -----END PRIVACY-ENHANCED MESSAGE-----